Stock Analysis

When Should You Buy Universal Logistics Holdings, Inc. (NASDAQ:ULH)?

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NasdaqGS:ULH
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While Universal Logistics Holdings, Inc. (NASDAQ:ULH) might not be the most widely known stock at the moment, it saw a decent share price growth in the teens level on the NASDAQGS over the last few months. Less-covered, small caps sees more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Today I will analyse the most recent data on Universal Logistics Holdings’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Universal Logistics Holdings

What is Universal Logistics Holdings worth?

According to my valuation model, Universal Logistics Holdings seems to be fairly priced at around 12% below my intrinsic value, which means if you buy Universal Logistics Holdings today, you’d be paying a fair price for it. And if you believe that the stock is really worth $24.69, 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 Universal Logistics Holdings’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 kind of growth will Universal Logistics Holdings generate?

earnings-and-revenue-growth
NasdaqGS:ULH Earnings and Revenue Growth December 8th 2020

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. With profit expected to grow by 87% over the next year, the near-term future seems bright for Universal Logistics Holdings. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? ULH’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 financial strength of the company. 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 ULH, now may not be the most advantageous 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.

If you want to dive deeper into Universal Logistics Holdings, you'd also look into what risks it is currently facing. You'd be interested to know, that we found 1 warning sign for Universal Logistics Holdings and you'll want to know about it.

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What are the risks and opportunities for Universal Logistics Holdings?

Universal Logistics Holdings, Inc. provides transportation and logistics solutions in the United States, Mexico, Canada, and Colombia.

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Rewards

  • Price-To-Earnings ratio (6.3x) is below the US market (15x)

  • Earnings are forecast to grow 2.1% per year

  • Earnings grew by 105.2% over the past year

Risks

  • Has a high level of debt

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Share Price

Market Cap

1Y Return

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Further research on
Universal Logistics Holdings

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