Is It Time To Consider Buying International Flavors & Fragrances Inc. (NYSE:IFF)?

International Flavors & Fragrances Inc. (NYSE:IFF) received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$105 at one point, and dropping to the lows of US$94.21. 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 International Flavors & Fragrances' current trading price of US$103 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 International Flavors & Fragrances’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for International Flavors & Fragrances

What's The Opportunity In International Flavors & Fragrances?

According to our valuation model, International Flavors & Fragrances seems to be fairly priced at around 1.8% below our intrinsic value, which means if you buy International Flavors & Fragrances today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $104.54, then there’s not much of an upside to gain from mispricing. So, is there another chance to buy low in the future? Given that International Flavors & Fragrances’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

Can we expect growth from International Flavors & Fragrances?

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. Though in the case of International Flavors & Fragrances, it is expected to deliver a relatively unexciting top-line growth of 4.3% 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? IFF’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 track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on IFF, 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 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 International Flavors & Fragrances at this point in time. Case in point: We've spotted 1 warning sign for International Flavors & Fragrances you should be aware of.

If you are no longer interested in International Flavors & Fragrances, 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.