Cedar Realty Trust Inc (NYSE:CDR), which is in the reits business, and is based in United States, received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to $4.76 at one point, and dropping to the lows of $3.65. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Cedar Realty Trust’s current trading price of $3.65 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 Cedar Realty Trust’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Is Cedar Realty Trust still cheap?
Good news, investors! Cedar Realty Trust is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $4.89, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Cedar Realty Trust’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 kind of growth will Cedar Realty Trust generate?
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 expected decline of -3.6% in revenues over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for Cedar Realty Trust. This certainty tips the risk-return scale towards higher risk.
What this means for you:
Are you a shareholder? Although CDR is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. I recommend you think about whether you want to increase your portfolio exposure to CDR, 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 tabs on CDR for some time, but hesitant on making the leap, I recommend you research further 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 Cedar Realty Trust. You can find everything you need to know about Cedar Realty Trust in the latest infographic research report. If you are no longer interested in Cedar Realty Trust, 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 email@example.com.