At US$71.75, Is Spectrum Brands Holdings, Inc. (NYSE:SPB) Worth Looking At Closely?

Spectrum Brands Holdings, Inc. (NYSE:SPB), might not be a large cap stock, but it saw significant share price movement during recent months on the NYSE, rising to highs of US$83.79 and falling to the lows of US$65.66. 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 Spectrum Brands Holdings' current trading price of US$71.75 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 Spectrum Brands Holdings’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Spectrum Brands Holdings

What's The Opportunity In Spectrum Brands Holdings?

Good news, investors! Spectrum Brands Holdings is still a bargain right now. According to my valuation, the intrinsic value for the stock is $118.34, but it is currently trading at US$71.75 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Spectrum Brands Holdings’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

Can we expect growth from Spectrum Brands Holdings?

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. Though in the case of Spectrum Brands Holdings, it is expected to deliver a relatively unexciting top-line growth of 1.8% in the next few years, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since SPB is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. 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 SPB for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy SPB. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.

So while earnings quality is important, it's equally important to consider the risks facing Spectrum Brands Holdings at this point in time. For example, we've discovered 1 warning sign that you should run your eye over to get a better picture of Spectrum Brands Holdings.

If you are no longer interested in Spectrum Brands Holdings, 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.