At HK$2.00, Is It Time To Buy International Housewares Retail Company Limited (HKG:1373)?
International Housewares Retail Company Limited (HKG:1373), a specialty retail company based in Hong Kong, saw a decent share price growth in the teens level on the SEHK over the last few months. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s examine International Housewares Retail’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
See our latest analysis for International Housewares Retail
Is International Housewares Retail still cheap?
Great news for investors – International Housewares Retail is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is HK$2.86, but it is currently trading at HK$2.00 on the share market, meaning that there is still an opportunity to buy now. International Housewares Retail’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 International Housewares Retail look like?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. However, with a relatively muted profit growth of 6.8% expected over the next year, growth doesn’t seem like a key driver for a buy decision for International Housewares Retail, at least in the short term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since 1373 is currently undervalued, it may be a great time to increase your holdings in the stock. 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 1373 for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy 1373. 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 buy.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on International Housewares Retail. You can find everything you need to know about International Housewares Retail in the latest infographic research report. If you are no longer interested in International Housewares Retail, 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.