Iren SpA (BIT:IRE), which is in the integrated utilities business, and is based in Italy, saw significant share price movement during recent months on the BIT, rising to highs of €2.32 and falling to the lows of €2.05. 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 Iren's current trading price of €2.18 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Iren’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
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What is Iren worth?
Great news for investors – Iren is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is €3.71, but it is currently trading at €2.18 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Iren’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
What does the future of Iren look like?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. 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 a relatively muted profit growth of 9.3% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Iren, at least in the short term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since IRE 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 IRE 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 IRE. 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 Iren. You can find everything you need to know about Iren in the latest infographic research report. If you are no longer interested in Iren, 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 firstname.lastname@example.org. 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.