Is It Too Late To Consider Buying United States Lime & Minerals, Inc. (NASDAQ:USLM)?

United States Lime & Minerals, Inc. (NASDAQ:USLM), might not be a large cap stock, but it saw a significant share price rise of 32% in the past couple of months on the NASDAQGS. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. As a US$3.6b market-cap stock, it seems odd United States Lime & Minerals is not more well-covered by analysts. However, this is not necessarily a bad thing given that there are less eyes on the stock to push it closer to fair value. Is there still an opportunity to buy? Let’s take a look at United States Lime & Minerals’s outlook and value based on the most recent financial data to see if the opportunity still exists.

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Is United States Lime & Minerals Still Cheap?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 3.7% below our intrinsic value, which means if you buy United States Lime & Minerals today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $130.74, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since United States Lime & Minerals’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.

View our latest analysis for United States Lime & Minerals

What does the future of United States Lime & Minerals look like?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. 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 revenues expected to grow by a double-digit 23% over the next couple of years, the outlook is positive for United States Lime & Minerals. If the level of expenses is able to be maintained, 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? USLM’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 track record of its management team. 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 USLM, 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 further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. Case in point: We've spotted 1 warning sign for United States Lime & Minerals you should be aware of.

If you are no longer interested in United States Lime & Minerals, 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.