What Is Service Corporation International's (NYSE:SCI) Share Price Doing?

Today we're going to take a look at the well-established Service Corporation International (NYSE:SCI). The company's stock saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. The recent jump in the share price has meant that the company is trading around its 52-week high. As a large-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 Service Corporation International’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Service Corporation International

What's The Opportunity In Service Corporation International?

According to our valuation model, Service Corporation International seems to be fairly priced at around 4.23% above our intrinsic value, which means if you buy Service Corporation International today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth $69.92, there’s only an insignificant downside when the price falls to its real value. What's more, Service Corporation International’s share price may be more stable over time (relative to the market), as indicated by its low beta.

What does the future of Service Corporation International 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. However, with a relatively muted profit growth of 6.5% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Service Corporation International, at least in the short term.

What This Means For You

Are you a shareholder? SCI’s 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 tabs on SCI, 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.

So while earnings quality is important, it's equally important to consider the risks facing Service Corporation International at this point in time. Case in point: We've spotted 2 warning signs for Service Corporation International you should be mindful of and 1 of these can't be ignored.

If you are no longer interested in Service Corporation International, 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.