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What Is Kronos Worldwide, Inc.'s (NYSE:KRO) Share Price Doing?

Simply Wall St

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Kronos Worldwide, Inc. (NYSE:KRO), which is in the chemicals 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 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 take a look at Kronos Worldwide’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Kronos Worldwide

Is Kronos Worldwide still cheap?

Good news, investors! Kronos Worldwide is still a bargain right now. According to my valuation, the intrinsic value for the stock is $18.68, but it is currently trading at US$14.47 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Kronos Worldwide’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 the stock moves relative to the rest of the market.

What kind of growth will Kronos Worldwide generate?

NYSE:KRO Past and Future Earnings, June 15th 2019

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. With revenues expected to grow by a double-digit 10% over the next couple of years, the outlook is positive for Kronos Worldwide. If the level of expenses is able to be maintained, 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? Since KRO is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. 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 KRO for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy KRO. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, 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 Kronos Worldwide. You can find everything you need to know about Kronos Worldwide in the latest infographic research report. If you are no longer interested in Kronos Worldwide, 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.