While AlzChem Group AG (ETR:ACT) might not have the largest market cap around , it saw a significant share price rise of 41% in the past couple of months on the XTRA. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. As a stock with high coverage by analysts, you could assume any recent changes in the company's outlook is already priced into the stock. However, what if the stock is still a bargain? Let's take a look at AlzChem Group's outlook and value based on the most recent financial data to see if the opportunity still exists.
Check out our latest analysis for AlzChem Group
Great news for investors - AlzChem Group is still trading at a fairly cheap price according to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average. We've used the price-to-earnings ratio in this instance because there's not enough visibility to forecast its cash flows. The stock's ratio of 11.66x is currently well-below the industry average of 22.63x, meaning that it is trading at a cheaper price relative to its peers. Another thing to keep in mind is that AlzChem Group's share price is quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its industry peers, a low beta could suggest it is not likely to reach that level anytime soon, and once it's there, it may be hard to fall back down into an attractive buying range again.
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 57% over the next couple of years, the future seems bright for AlzChem Group. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
Are you a shareholder? Since ACT is currently below the industry PE ratio, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current price multiple.
Are you a potential investor? If you've been keeping an eye on ACT for a while, now might be the time to make a leap. Its prosperous future profit outlook isn't fully reflected in the current share price yet, which means it's not too late to buy ACT. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed assessment.