Unum Group (NYSE:UNM) saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. As a large-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, what if the stock is still a bargain? Let’s take a look at UNM’s outlook and value based on the most recent financial data to see if the opportunity still exists. Check out our latest analysis for Unum Group
Is UNM still cheap?
Good news, investors! UNM is still a bargain right now. I’ve used the price-to-equity ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 12.4x is currently well-below the industry average of 17.8x, meaning that it is trading at a cheaper price relative to its peers. What’s more interesting is that, UNM’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much UNM moves relative to the rest of the market.
Can we expect growth from UNM?
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 UNM future expectations. However, with a relatively muted profit growth of 1.21% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for UNM, at least in the short term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since UNM is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on UNM for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy UNM. 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 investment decision.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Unum Group. You can find everything you need to know about UNM in the latest infographic research report. If you are no longer interested in Unum Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass 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.