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What Does Tikkurila Oyj's (HEL:TIK1V) Share Price Indicate?

Simply Wall St

Tikkurila Oyj (HEL:TIK1V), which is in the chemicals business, and is based in Finland, saw significant share price movement during recent months on the HLSE, rising to highs of €15.5 and falling to the lows of €13.9. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Tikkurila Oyj's current trading price of €14.64 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Tikkurila Oyj’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Tikkurila Oyj

Is Tikkurila Oyj still cheap?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 2.0% below my intrinsic value, which means if you buy Tikkurila Oyj today, you’d be paying a fair price for it. And if you believe the company’s true value is €14.94, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, Tikkurila Oyj’s low beta implies that the stock is less volatile than the wider market.

What kind of growth will Tikkurila Oyj generate?

HLSE:TIK1V Past and Future Earnings, July 22nd 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. With profit expected to more than double over the next couple of years, the future seems bright for Tikkurila Oyj. 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? It seems like the market has already priced in TIK1V’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. 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 TIK1V, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

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