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Is Crown Holdings, Inc. (NYSE:CCK) Potentially Undervalued?

Simply Wall St

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Crown Holdings, Inc. (NYSE:CCK), which is in the packaging business, and is based in United States, led the NYSE gainers with a relatively large price hike in the past couple of weeks. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at Crown Holdings’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Crown Holdings

Is Crown Holdings still cheap?

Good news, investors! Crown Holdings is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $80.87, but it is currently trading at US$59.49 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Crown 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 does the future of Crown Holdings look like?

NYSE:CCK Past and Future Earnings, May 8th 2019

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. In the upcoming year, Crown Holdings’s earnings are expected to increase by 31%, 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? Since CCK is currently undervalued, it may be a great time to increase 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 financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on CCK for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy CCK. 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 investment decision.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Crown Holdings. You can find everything you need to know about Crown Holdings in the latest infographic research report. If you are no longer interested in Crown Holdings, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Thank you for reading.