At US$65.43, Is Fortune Brands Innovations, Inc. (NYSE:FBIN) Worth Looking At Closely?

Fortune Brands Innovations, Inc. (NYSE:FBIN), is not the largest company out there, but it saw significant share price movement during recent months on the NYSE, rising to highs of US$75.77 and falling to the lows of US$63.00. 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 Fortune Brands Innovations' current trading price of US$65.43 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 Fortune Brands Innovations’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 Fortune Brands Innovations

What's The Opportunity In Fortune Brands Innovations?

According to my valuation model, Fortune Brands Innovations seems to be fairly priced at around 17.18% above my intrinsic value, which means if you buy Fortune Brands Innovations today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is $55.84, then there isn’t really any room for the share price grow beyond what it’s currently trading. So, is there another chance to buy low in the future? Given that Fortune Brands Innovations’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 an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

Can we expect growth from Fortune Brands Innovations?

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. Fortune Brands Innovations' earnings over the next few years are expected to increase by 40%, 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? FBIN’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 financial strength of the company. 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 FBIN, 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 diving deeper into 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. You'd be interested to know, that we found 1 warning sign for Fortune Brands Innovations and you'll want to know about this.

If you are no longer interested in Fortune Brands Innovations, 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.