Should You Investigate SIA Engineering Company Limited (SGX:S59) At S$2.41?

While SIA Engineering Company Limited (SGX:S59) might not be the most widely known stock at the moment, it saw a double-digit share price rise of over 10% in the past couple of months on the SGX. As a well-established company, which tends to be well-covered by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at SIA Engineering’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for SIA Engineering

What Is SIA Engineering Worth?

According to my valuation model, SIA Engineering seems to be fairly priced at around 2.61% above my intrinsic value, which means if you buy SIA Engineering today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth SGD2.35, there’s only an insignificant downside when the price falls to its real value. In addition to this, SIA Engineering has a low beta, which suggests its share price is less volatile than the wider market.

Can we expect growth from SIA Engineering?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by 70% over the next couple of years, the future seems bright for SIA Engineering. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? It seems like the market has already priced in S59’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on S59, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you'd like to know more about SIA Engineering as a business, it's important to be aware of any risks it's facing. At Simply Wall St, we found 1 warning sign for SIA Engineering and we think they deserve your attention.

If you are no longer interested in SIA Engineering, 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.