Is Now The Time To Look At Buying Core & Main, Inc. (NYSE:CNM)?

While Core & Main, Inc. (NYSE:CNM) might not be the most widely known stock at the moment, it saw a decent share price growth in the teens level on the NYSE over the last few months. 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, could the stock still be trading at a relatively cheap price? Let’s take a look at Core & Main’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Core & Main

What's The Opportunity In Core & Main?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 2.37% above my intrinsic value, which means if you buy Core & Main today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth $30.47, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, Core & Main’s share price may be more stable over time (relative to the market), as indicated by its low beta.

Can we expect growth from Core & Main?

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. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by 36% over the next couple of years, the future seems bright for Core & Main. 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? CNM’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 CNM, 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 further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. While conducting our analysis, we found that Core & Main has 1 warning sign and it would be unwise to ignore it.

If you are no longer interested in Core & Main, 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.