Should You Think About Buying MTY Food Group Inc. (TSE:MTY) Now?
MTY Food Group Inc. (TSE:MTY), is not the largest company out there, but it received a lot of attention from a substantial price movement on the TSX over the last few months, increasing to CA$66.72 at one point, and dropping to the lows of CA$50.12. 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 MTY Food Group's current trading price of CA$52.58 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at MTY Food Group’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for MTY Food Group
What's The Opportunity In MTY Food Group?
Good news, investors! MTY Food Group is still a bargain right now. According to my valuation, the intrinsic value for the stock is CA$84.99, but it is currently trading at CA$52.58 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 MTY Food Group’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 MTY Food Group generate?
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 the company's future expectations. Though in the case of MTY Food Group, it is expected to deliver a relatively unexciting top-line growth of 7.9% in the next few years, 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 MTY 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 MTY for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MTY. 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 buy.
Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. For example, we've discovered 2 warning signs that you should run your eye over to get a better picture of MTY Food Group.
If you are no longer interested in MTY Food Group, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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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.
