Restaurant Brands International Inc (NYSE:QSR) saw its share price hover around a small range of $59.23 to $63.1 over the last few weeks. But is this actually reflective of the share value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at QSR’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 QSR
What's the opportunity in QSR?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 1% above my intrinsic value, which means if you buy QSR today, you’d be paying a relatively fair price for it. And if you believe that QSR is really worth $62.69, there’s only an insignificant downside when the price falls to its real value. Although, there may be an opportunity to buy in the future. This is because QSR’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, QSR’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Can we expect growth from QSR?
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. QSR’s earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? It seems like the market has already priced in QSR’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at QSR? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping an eye on QSR, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for QSR, which means it’s worth further examining 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 Restaurant Brands International. You can find everything you need to know about QSR in the latest infographic research report. If you are no longer interested in Restaurant Brands International, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.