At US$27.29, Is It Time To Put Element Solutions Inc (NYSE:ESI) On Your Watch List?

Element Solutions Inc (NYSE:ESI), is not the largest company out there, but it saw a decent share price growth of 11% on the NYSE over the last few months. The recent share price gains has brought the company back closer to its yearly peak. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Let’s examine Element Solutions’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

View our latest analysis for Element Solutions

What's The Opportunity In Element Solutions?

Good news, investors! Element Solutions is still a bargain right now. Our valuation model shows that the intrinsic value for the stock is $42.99, but it is currently trading at US$27.29 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 Element Solutions’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.

What does the future of Element Solutions look like?

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. However, with a relatively muted profit growth of 0.2% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Element Solutions, at least in the short term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since ESI is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on ESI 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 ESI. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. At Simply Wall St, we found 1 warning sign for Element Solutions and we think they deserve your attention.

If you are no longer interested in Element Solutions, 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.