Stock Analysis

At US$114, Is Masonite International Corporation (NYSE:DOOR) Worth Looking At Closely?

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NYSE:DOOR
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Masonite International Corporation (NYSE:DOOR), is not the largest company out there, but it received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$128 at one point, and dropping to the lows of US$106. 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 Masonite International's current trading price of US$114 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 Masonite International’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Masonite International

Is Masonite International still cheap?

Great news for investors – Masonite International is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $188.96, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Masonite International’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

Can we expect growth from Masonite International?

earnings-and-revenue-growth
NYSE:DOOR Earnings and Revenue Growth January 6th 2022

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. Masonite International's earnings over the next few years are expected to increase by 68%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since DOOR is currently undervalued, it may be a great time to increase your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. 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 DOOR for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy DOOR. 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 investment decision.

If you'd like to know more about Masonite International as a business, it's important to be aware of any risks it's facing. For example - Masonite International has 2 warning signs we think you should be aware of.

If you are no longer interested in Masonite International, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

What are the risks and opportunities for Masonite International?

Masonite International Corporation designs, manufactures, markets, and distributes interior and exterior doors for the new construction and repair, renovation, and remodeling sectors of the residential and non-residential building construction markets worldwide.

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Rewards

  • Trading at 48.8% below our estimate of its fair value

  • Earnings are forecast to grow 4.54% per year

Risks

  • Debt is not well covered by operating cash flow

  • Significant insider selling over the past 3 months

  • Large one-off items impacting financial results

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Share Price

Market Cap

1Y Return

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Further research on
Masonite International

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About NYSE:DOOR

Masonite International

Masonite International Corporation designs, manufactures, markets, and distributes interior and exterior doors for the new construction and repair, renovation, and remodeling sectors of the residential and non-residential building construction markets worldwide.

Undervalued with mediocre balance sheet.