Today we’re going to take a look at the well-established Agilent Technologies Inc (NYSE:A). The company’s stock received a lot of attention from a substantial price movement on the NYSE in the over the last few months, increasing to $74.82 at one point, and dropping to the lows of $65.05. 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 Agilent Technologies’s current trading price of $66.98 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 Agilent Technologies’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 Agilent Technologies
What’s the opportunity in Agilent Technologies?The stock is currently trading at US$66.98 on the share market, which means it is overvalued by 58% compared to my intrinsic value of $42.32. This means that the opportunity to buy Agilent Technologies at a good price has disappeared! If you like the stock, you may want to keep an eye out for a potential price decline in the future. Given that Agilent Technologies’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 another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
What kind of growth will Agilent Technologies generate?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. 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. Agilent Technologies’s earnings over the next few years are expected to increase by 38.00%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in A’s positive outlook, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? If you believe A should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping tabs on A for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the optimistic prospect is encouraging for A, which means it’s worth diving deeper into other factors 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 Agilent Technologies. You can find everything you need to know about Agilent Technologies in the latest infographic research report. If you are no longer interested in Agilent Technologies, you can use our free platform to see my list of over 50 other stocks with a high growth potential.