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Should You Think About Buying UMB Financial Corporation (NASDAQ:UMBF) Now?

Simply Wall St

UMB Financial Corporation (NASDAQ:UMBF), operating in the financial services industry based in United States, saw significant share price movement during recent months on the NASDAQGS, rising to highs of $68.26 and falling to the lows of $61.47. 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 UMB Financial's current trading price of $64.62 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 UMB Financial’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 UMB Financial

What is UMB Financial worth?

According to my valuation model, UMB Financial seems to be fairly priced at around 3.8% below my intrinsic value, which means if you buy UMB Financial today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth $67.17, then there isn’t much room for the share price grow beyond what it’s currently trading. In addition to this, UMB Financial has a low beta, which suggests its share price is less volatile than the wider market.

What kind of growth will UMB Financial generate?

NasdaqGS:UMBF Past and Future Earnings, August 20th 2019

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. UMB Financial’s earnings growth are expected to be in the teens in the upcoming year, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? UMBF’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on UMBF, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on UMB Financial. You can find everything you need to know about UMB Financial in the latest infographic research report. If you are no longer interested in UMB Financial, 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.