Sealed Air Corporation (NYSE:SEE), a packaging company based in United States, received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to $45.77 at one point, and dropping to the lows of $41.12. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Sealed Air’s current trading price of $44.05 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 Sealed Air’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 Sealed Air
Is Sealed Air still cheap?The stock seems fairly valued at the moment according to my valuation model. It’s trading around 0.52% below my intrinsic value, which means if you buy Sealed Air today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $44.28, then there isn’t much room for the share price grow beyond what it’s currently trading. Although, there may be an opportunity to buy in the future. This is because Sealed Air’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 Sealed Air?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. Sealed Air’s revenue growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? SEE’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 an eye on SEE, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Sealed Air. You can find everything you need to know about Sealed Air in the latest infographic research report. If you are no longer interested in Sealed Air, you can use our free platform to see my list of over 50 other stocks with a high growth potential.