Is Now The Time To Look At Buying Matson, Inc. (NYSE:MATX)?
While Matson, Inc. (NYSE:MATX) might not have the largest market cap around , it received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$122 at one point, and dropping to the lows of US$96.25. 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 Matson's current trading price of US$105 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 Matson’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
View our latest analysis for Matson
What Is Matson Worth?
Great news for investors – Matson is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $147.57, but it is currently trading at US$105 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Matson’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
What kind of growth will Matson generate?
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 negative profit growth of -3.7% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for Matson. This certainty tips the risk-return scale towards higher risk.
What This Means For You
Are you a shareholder? Although MATX is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. We recommend you think about whether you want to increase your portfolio exposure to MATX, 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 MATX for some time, but hesitant on making the leap, we recommend you dig deeper 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.
Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. For example, we've found that Matson has 3 warning signs (1 is a bit concerning!) that deserve your attention before going any further with your analysis.
If you are no longer interested in Matson, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
