Is It Too Late To Consider Buying Bio-Rad Laboratories, Inc. (NYSE:BIO)?
Today we're going to take a look at the well-established Bio-Rad Laboratories, Inc. (NYSE:BIO). The company's stock saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. As a large-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, what if the stock is still a bargain? Let’s examine Bio-Rad Laboratories’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
View our latest analysis for Bio-Rad Laboratories
What's The Opportunity In Bio-Rad Laboratories?
According to my valuation model, Bio-Rad Laboratories seems to be fairly priced at around 2.4% below my intrinsic value, which means if you buy Bio-Rad Laboratories today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $411.72, then there isn’t much room for the share price grow beyond what it’s currently trading. What's more, Bio-Rad Laboratories’s share price may be more stable over time (relative to the market), as indicated by its low beta.
Can we expect growth from Bio-Rad Laboratories?
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. In the upcoming year, Bio-Rad Laboratories' earnings are expected to increase by 90%, 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? BIO’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 BIO, 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 diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. While conducting our analysis, we found that Bio-Rad Laboratories has 1 warning sign and it would be unwise to ignore this.
If you are no longer interested in Bio-Rad Laboratories, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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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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