Let's talk about the popular MTU Aero Engines AG (ETR:MTX). The company's shares saw a significant share price rise of 22% in the past couple of months on the XTRA. The company is now trading at yearly-high levels following the recent surge in its share price. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Let’s take a look at MTU Aero Engines’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for MTU Aero Engines
What Is MTU Aero Engines Worth?
Great news for investors – MTU Aero Engines is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is €481.95, but it is currently trading at €323 on the share market, meaning that there is still an opportunity to buy now. However, given that MTU Aero Engines’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
Can we expect growth from MTU Aero Engines?
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. With profit expected to grow by 41% over the next couple of years, the future seems bright for MTU Aero Engines. 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? Since MTX is currently undervalued, it may be a great time to accumulate more of 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 capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on MTX for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MTX. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.