Sterling Bancorp (NYSE:STL), operating in the financial services industry based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s examine Sterling Bancorp’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
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What’s the opportunity in Sterling Bancorp?
Great news for investors – Sterling Bancorp is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $27.39, but it is currently trading at US$20.54 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Sterling Bancorp’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
Can we expect growth from Sterling Bancorp?
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. However, with a relatively muted profit growth of 0.3% expected over the next year, growth doesn’t seem like a key driver for a buy decision for Sterling Bancorp, at least in the short term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since STL 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 STL 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 STL. 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 buy.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Sterling Bancorp. You can find everything you need to know about Sterling Bancorp in the latest infographic research report. If you are no longer interested in Sterling Bancorp, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.