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Is It Too Late To Consider Buying DBS Group Holdings Ltd (SGX:D05)?

Simply Wall St

Let's talk about the popular DBS Group Holdings Ltd (SGX:D05). The company's shares saw its share price hover around a small range of S$24.55 to S$26.73 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 DBS Group Holdings’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for DBS Group Holdings

Is DBS Group Holdings still cheap?

According to my valuation model, DBS Group Holdings seems to be fairly priced at around 19% below my intrinsic value, which means if you buy DBS Group Holdings today, you’d be paying a fair price for it. And if you believe that the stock is really worth SGD31.96, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since DBS Group Holdings’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 kind of growth will DBS Group Holdings generate?

SGX:D05 Past and Future Earnings, January 4th 2020

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. Though in the case of DBS Group Holdings, it is expected to deliver a relatively unexciting earnings growth of 7.8%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What this means for you:

Are you a shareholder? It seems like the market has already priced in D05’s future 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 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 D05, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook 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 DBS Group Holdings. You can find everything you need to know about DBS Group Holdings in the latest infographic research report. If you are no longer interested in DBS Group Holdings, 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.