Dalata Hotel Group plc (ISE:DHG), which is in the hospitality business, and is based in Ireland, saw a double-digit share price rise of over 10% in the past couple of months on the ISE. 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 Dalata Hotel Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.
What is Dalata Hotel Group worth?
According to my valuation model, Dalata Hotel Group seems to be fairly priced at around 8.8% below my intrinsic value, which means if you buy Dalata Hotel Group today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth €6.58, then there’s not much of an upside to gain from mispricing. Furthermore, Dalata Hotel Group’s low beta implies that the stock is less volatile than the wider market.
What kind of growth will Dalata Hotel Group generate?
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. Dalata Hotel Group’s earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. This should lead to robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? DHG’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 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 tabs on DHG, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Dalata Hotel Group. You can find everything you need to know about Dalata Hotel Group in the latest infographic research report. If you are no longer interested in Dalata Hotel Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.