Is It Time To Consider Buying LCI Industries (NYSE:LCII)?
LCI Industries (NYSE:LCII), might not be a large cap stock, but it saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. 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? Today I will analyse the most recent data on LCI Industries’s outlook and valuation to see if the opportunity still exists.
Check out our latest analysis for LCI Industries
Is LCI Industries still cheap?
Good news, investors! LCI Industries is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $203.63, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that LCI Industries’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
What does the future of LCI Industries look like?
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 relatively muted profit growth of 8.8% expected over the next year, growth doesn’t seem like a key driver for a buy decision for LCI Industries, at least in the short term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since LCII is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on LCII 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 LCII. 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 investment decision.
If you'd like to know more about LCI Industries as a business, it's important to be aware of any risks it's facing. Case in point: We've spotted 2 warning signs for LCI Industries you should be mindful of and 1 of these shouldn't be ignored.
If you are no longer interested in LCI Industries, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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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