Is It Time To Buy Seritage Growth Properties (NYSE:SRG)?

Seritage Growth Properties (NYSE:SRG), a reits company based in United States, led the NYSE gainers with a relatively large price hike in the past couple of weeks. As a US$2.46b market-cap stock, it seems odd Seritage Growth Properties is not more well-covered by analysts. Although, there is more of an opportunity for mispricing in stocks with low coverage, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Let’s take a look at Seritage Growth Properties’s outlook and value based on the most recent financial data to see if the opportunity still exists. Check out our latest analysis for Seritage Growth Properties

Is Seritage Growth Properties still cheap?

According to my valuation model, Seritage Growth Properties seems to be fairly priced at around 3.85% above my intrinsic value, which means if you buy Seritage Growth Properties today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $42.42, there’s only an insignificant downside when the price falls to its real value. Although, there may be an opportunity to buy in the future. This is because Seritage Growth Properties’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 Seritage Growth Properties look like?

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. Seritage Growth Properties’s earnings over the next few years are expected to increase by 33.40%, 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 already priced in SRG’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. 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 SRG, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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 Seritage Growth Properties. You can find everything you need to know about Seritage Growth Properties in the latest infographic research report. If you are no longer interested in Seritage Growth Properties, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.