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Is It Time To Consider Buying S&T AG (ETR:SANT)?

Simply Wall St

S&T AG (ETR:SANT), which is in the tech business, and is based in Austria, received a lot of attention from a substantial price increase on the XTRA over the last few months. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at S&T’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for S&T

What's the opportunity in S&T?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 5.29% above my intrinsic value, which means if you buy S&T today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth €23.29, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since S&T’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of S&T look like?

XTRA:SANT Past and Future Earnings, February 21st 2020

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. 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. S&T’s earnings over the next few years are expected to increase by 93%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? SANT’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 conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on SANT, now may not be the most optimal 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 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 S&T. You can find everything you need to know about S&T in the latest infographic research report. If you are no longer interested in S&T, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

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.

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. Thank you for reading.