Stock Analysis
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- Medical Equipment
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- NYSE:TFX
Why Teleflex Incorporated (NYSE:TFX) Could Be Worth Watching
Teleflex Incorporated (NYSE:TFX) received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$444 at one point, and dropping to the lows of US$386. 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 Teleflex's current trading price of US$400 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Teleflex’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 Teleflex
Is Teleflex still cheap?
According to my valuation model, Teleflex seems to be fairly priced at around 6.53% above my intrinsic value, which means if you buy Teleflex today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth $375.75, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since Teleflex’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
Can we expect growth from Teleflex?
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. With profit expected to more than double over the next couple of years, the future seems bright for Teleflex. 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? TFX’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 tabs on TFX, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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 while earnings quality is important, it's equally important to consider the risks facing Teleflex at this point in time. Every company has risks, and we've spotted 2 warning signs for Teleflex you should know about.
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What are the risks and opportunities for Teleflex?
Teleflex Incorporated designs, develops, manufactures, and supplies single-use medical devices for common diagnostic and therapeutic procedures in critical care and surgical applications worldwide.
Rewards
Trading at 26.2% below our estimate of its fair value
Earnings are forecast to grow 13.5% per year
Risks
No risks detected for TFX from our risks checks.
Further research on
Teleflex
This article by Simply Wall St is general in nature. 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.
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About NYSE:TFX
Teleflex
Teleflex Incorporated designs, develops, manufactures, and supplies single-use medical devices for common diagnostic and therapeutic procedures in critical care and surgical applications worldwide.
Excellent balance sheet and good value.
