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What Is Signature Bank's (NASDAQ:SBNY) Share Price Doing?

Simply Wall St

Signature Bank (NASDAQ:SBNY), operating in the financial services industry based in United States, received a lot of attention from a substantial price increase on the NASDAQGS over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Signature Bank’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Signature Bank

What's the opportunity in Signature Bank?

Great news for investors – Signature Bank is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $192.64, but it is currently trading at US$148 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Signature Bank’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.

Can we expect growth from Signature Bank?

NasdaqGS:SBNY Past and Future Earnings, January 22nd 2020

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. Though in the case of Signature Bank, it is expected to deliver a relatively unexciting earnings growth of 4.0%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What this means for you:

Are you a shareholder? Even though growth is relatively muted, since SBNY 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 financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on SBNY 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 SBNY. 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 Signature Bank. You can find everything you need to know about Signature Bank in the latest infographic research report. If you are no longer interested in Signature Bank, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

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.

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. Thank you for reading.