Is It Time To Consider Buying Belden Inc. (NYSE:BDC)?
Belden Inc. (NYSE:BDC), might not be a large cap stock, but it saw a decent share price growth in the teens level on the NYSE over the last few months. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Belden’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for Belden
What's The Opportunity In Belden?
Great news for investors – Belden is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $128.18, but it is currently trading at US$85.97 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 Belden’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.
Can we expect growth from Belden?
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. However, with a negative profit growth of -3.6% expected next year, near-term growth certainly doesn’t appear to be a driver for a buy decision for Belden. This certainty tips the risk-return scale towards higher risk.
What This Means For You
Are you a shareholder? Although BDC is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. I recommend you think about whether you want to increase your portfolio exposure to BDC, 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 an eye on BDC for a while, but hesitant on making the leap, I 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.
If you want to dive deeper into Belden, you'd also look into what risks it is currently facing. At Simply Wall St, we found 2 warning signs for Belden and we think they deserve your attention.
If you are no longer interested in Belden, 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.
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