Jiangsu Yanghe Brewery Joint-Stock Co., Ltd. (SZSE:002304) received a lot of attention from a substantial price movement on the SZSE over the last few months, increasing to CN¥128 at one point, and dropping to the lows of CN¥100. 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 Jiangsu Yanghe Brewery's current trading price of CN¥100 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at Jiangsu Yanghe Brewery's outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Jiangsu Yanghe Brewery
What Is Jiangsu Yanghe Brewery Worth?
Good news, investors! Jiangsu Yanghe Brewery is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. We've used the price-to-earnings ratio in this instance because there's not enough visibility to forecast its cash flows. The stock's ratio of 14.25x is currently well-below the industry average of 31.08x, meaning that it is trading at a cheaper price relative to its peers. What's more interesting is that, Jiangsu Yanghe Brewery's share price is quite stable, which could mean two things: firstly, it may take the share price a while to move closer to its industry peers, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
Can we expect growth from Jiangsu Yanghe Brewery?
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. 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. Jiangsu Yanghe Brewery's earnings over the next few years are expected to increase by 54%, 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? Since 002304 is currently below the industry PE ratio, it may be a great time to increase your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current price multiple.
Are you a potential investor? If you've been keeping an eye on 002304 for a while, now might be the time to make a leap. Its prosperous future profit outlook isn't fully reflected in the current share price yet, which means it's not too late to buy 002304. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed assessment.
It can be quite valuable to consider what analysts expect for Jiangsu Yanghe Brewery from their most recent forecasts. At Simply Wall St, we have the analysts estimates which you can view by clicking here.
If you are no longer interested in Jiangsu Yanghe Brewery, 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.