Is Now The Time To Look At Buying Franklin Electric Co., Inc. (NASDAQ:FELE)?

Franklin Electric Co., Inc. (NASDAQ:FELE), might not be a large cap stock, but it saw a decent share price growth of 14% on the NASDAQGS 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. But what if there is still an opportunity to buy? Today we will analyse the most recent data on Franklin Electric’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Franklin Electric

What's The Opportunity In Franklin Electric?

According to our valuation model, Franklin Electric seems to be fairly priced at around 10.09% above our intrinsic value, which means if you buy Franklin Electric today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $87.75, then there isn’t really any room for the share price grow beyond what it’s currently trading. Furthermore, Franklin Electric’s low beta implies that the stock is less volatile than the wider market.

What does the future of Franklin Electric look like?

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. Franklin Electric's earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? FELE’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 track record of its management team. 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 FELE, now may not be the most advantageous 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 Franklin Electric as a business, it's important to be aware of any risks it's facing. You'd be interested to know, that we found 1 warning sign for Franklin Electric and you'll want to know about this.

If you are no longer interested in Franklin Electric, 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.