Leggett & Platt, Incorporated (NYSE:LEG), is not the largest company out there, but it led the NYSE gainers with a relatively large price hike in the past couple of weeks. The recent rally in share prices has nudged the company in the right direction, though it still falls short of its yearly peak. As a 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 we will analyse the most recent data on Leggett & Platt's outlook and valuation to see if the opportunity still exists.

What Is Leggett & Platt Worth?

The stock seems fairly valued at the moment according to our valuation model. It's trading around 4.44% above our intrinsic value, which means if you buy Leggett & Platt today, you'd be paying a relatively reasonable price for it. And if you believe the company's true value is $12.08, then there isn't really any room for the share price grow beyond what it's currently trading. Although, there may be an opportunity to buy in the future. This is because Leggett & Platt's beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What kind of growth will Leggett & Platt generate?

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. However, with a relatively muted revenue growth of 2.7% expected over the next couple of years, growth doesn't seem like a key driver for a buy decision for Leggett & Platt, at least in the short term.

What This Means For You

Are you a shareholder? It seems like the market has already priced in LEG'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 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 tabs on LEG, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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.

If you want to dive deeper into Leggett & Platt, you'd also look into what risks it is currently facing. Case in point: We've spotted 2 warning signs for Leggett & Platt you should be mindful of and 1 of these is concerning.

If you are no longer interested in Leggett & Platt, 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.