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What Does STAG Industrial, Inc.'s (NYSE:STAG) Share Price Indicate?

Simply Wall St

STAG Industrial, Inc. (NYSE:STAG), which is in the reits business, and is based in United States, saw a decent share price growth in the teens level on the NYSE over the last few months. 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. However, could the stock still be trading at a relatively cheap price? Let’s take a look at STAG Industrial’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for STAG Industrial

Is STAG Industrial still cheap?

Good news, investors! STAG Industrial is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $52.61, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. STAG Industrial’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

What does the future of STAG Industrial look like?

NYSE:STAG Past and Future Earnings, November 19th 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. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for STAG Industrial, at least in the near future.

What this means for you:

Are you a shareholder? Although STAG is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. Consider whether you want to increase your portfolio exposure to STAG, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping an eye on STAG for a while, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on STAG Industrial. You can find everything you need to know about STAG Industrial in the latest infographic research report. If you are no longer interested in STAG Industrial, 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.