Corporate Office Properties Trust (NYSE:OFC), which is in the reits business, and is based in United States, saw its share price hover around a small range of US$27.93 to US$30.29 over the last few weeks. But is this actually reflective of the share value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Corporate Office Properties Trust’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Is Corporate Office Properties Trust still cheap?
Good news, investors! Corporate Office Properties Trust is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $52.86, but it is currently trading at US$30.29 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Corporate Office Properties Trust’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
Can we expect growth from Corporate Office Properties Trust?
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. Though in the case of Corporate Office Properties Trust, it is expected to deliver a highly negative earnings growth in the next few years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? Although OFC is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to OFC, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping an eye on OFC for a while, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Corporate Office Properties Trust. You can find everything you need to know about Corporate Office Properties Trust in the latest infographic research report. If you are no longer interested in Corporate Office Properties Trust, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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