At NT$162, Is It Time To Put Chung-Hsin Electric and Machinery Manufacturing Corp. (TWSE:1513) On Your Watch List?

Chung-Hsin Electric and Machinery Manufacturing Corp. (TWSE:1513), is not the largest company out there, but it received a lot of attention from a substantial price increase on the TWSE over the last few months. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Today we will analyse the most recent data on Chung-Hsin Electric and Machinery Manufacturing’s outlook and valuation to see if the opportunity still exists.

See our latest analysis for Chung-Hsin Electric and Machinery Manufacturing

What's The Opportunity In Chung-Hsin Electric and Machinery Manufacturing?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 19% below our intrinsic value, which means if you buy Chung-Hsin Electric and Machinery Manufacturing today, you’d be paying a fair price for it. And if you believe the company’s true value is NT$199.48, then there isn’t much room for the share price grow beyond what it’s currently trading. What's more, Chung-Hsin Electric and Machinery Manufacturing’s share price may be more stable over time (relative to the market), as indicated by its low beta.

What kind of growth will Chung-Hsin Electric and Machinery Manufacturing generate?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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 more than double over the next couple of years, the future seems bright for Chung-Hsin Electric and Machinery Manufacturing. 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? 1513’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on 1513, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook 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 Chung-Hsin Electric and Machinery Manufacturing as a business, it's important to be aware of any risks it's facing. For example, we've discovered 5 warning signs that you should run your eye over to get a better picture of Chung-Hsin Electric and Machinery Manufacturing.

If you are no longer interested in Chung-Hsin Electric and Machinery Manufacturing, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.