Is It Time To Consider Buying Venture Corporation Limited (SGX:V03)?

While Venture Corporation Limited (SGX:V03) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the SGX, rising to highs of S$16.09 and falling to the lows of S$12.64. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Venture's current trading price of S$13.18 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Venture’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Venture

What Is Venture Worth?

Good news, investors! Venture is still a bargain right now. My valuation model shows that the intrinsic value for the stock is SGD17.84, but it is currently trading at S$13.18 on the share market, meaning that there is still an opportunity to buy now. Another thing to keep in mind is that Venture’s share price may be quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.

What does the future of Venture look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with a relatively muted profit growth of 1.5% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Venture, at least in the short term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since V03 is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on V03 for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy V03. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.

So while earnings quality is important, it's equally important to consider the risks facing Venture at this point in time. At Simply Wall St, we found 1 warning sign for Venture and we think they deserve your attention.

If you are no longer interested in Venture, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.