Is CGN New Energy Holdings Co Ltd (HKG:1811) Undervalued?
CGN New Energy Holdings Co Ltd (HKG:1811), a renewable energy company based in Hong Kong, led the SEHK gainers with a relatively large price hike in the past couple of weeks. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at CGN New Energy Holdings’s outlook and value based on the most recent financial data to see if the opportunity still exists.
Check out our latest analysis for CGN New Energy Holdings
Is CGN New Energy Holdings still cheap?
Good news, investors! CGN New Energy Holdings is still a bargain right now. According to my valuation, the intrinsic value for the stock is HK$2.14, but it is currently trading at US$1.36 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, CGN New Energy Holdings’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
What kind of growth will CGN New Energy Holdings 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. With profit expected to grow by 20.7% over the next couple of years, the future seems bright for CGN New Energy 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? Since 1811 is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive 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 capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on 1811 for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy 1811. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on CGN New Energy Holdings. You can find everything you need to know about CGN New Energy Holdings in the latest infographic research report. If you are no longer interested in CGN New Energy Holdings, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
