What Does Franklin Electric Co., Inc.'s (NASDAQ:FELE) Share Price Indicate?

While Franklin Electric Co., Inc. (NASDAQ:FELE) might not have the largest market cap around , it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$107 and falling to the lows of US$96.21. 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 Franklin Electric's current trading price of US$99.06 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 Franklin Electric’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Check out our latest analysis for Franklin Electric

Is Franklin Electric Still Cheap?

According to our valuation model, Franklin Electric seems to be fairly priced at around 16% below our intrinsic value, which means if you buy Franklin Electric today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $118.00, then there isn’t much 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 kind of growth will Franklin Electric 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. However, with a relatively muted profit growth of 8.5% expected over the next year, growth doesn’t seem like a key driver for a buy decision for Franklin Electric, at least in the short term.

What This Means For You

Are you a shareholder? It seems like the market has already priced in FELE’s future outlook, 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 confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on FELE, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. For example, we've discovered 1 warning sign that you should run your eye over to get a better picture of Franklin Electric.

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.