While VATS Liquor Chain Store Management Joint Stock Co., Ltd. (SZSE:300755) might not have the largest market cap around , it received a lot of attention from a substantial price movement on the SZSE over the last few months, increasing to CN¥18.37 at one point, and dropping to the lows of CN¥15.22. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether VATS Liquor Chain Store Management's current trading price of CN¥15.22 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at VATS Liquor Chain Store Management's outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Is VATS Liquor Chain Store Management Still Cheap?

According to our valuation model, VATS Liquor Chain Store Management seems to be fairly priced at around 9.95% above our intrinsic value, which means if you buy VATS Liquor Chain Store Management today, you'd be paying a relatively reasonable price for it. And if you believe the company's true value is CN¥13.84, there's only an insignificant downside when the price falls to its real value. In addition to this, VATS Liquor Chain Store Management has a low beta, which suggests its share price is less volatile than the wider market.

What does the future of VATS Liquor Chain Store Management look like?

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. With profit expected to grow by 45% over the next couple of years, the future seems bright for VATS Liquor Chain Store Management. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? 300755'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 an eye on 300755, now may not be the most advantageous 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.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. Case in point: We've spotted 2 warning signs for VATS Liquor Chain Store Management you should be aware of.

If you are no longer interested in VATS Liquor Chain Store Management, 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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