Xiamen International Port Co Ltd (SEHK:3378), a infrastructure company based in China, saw significant share price volatility over the past couple of months on the SEHK, rising to the highs of HK$1.6 and falling to the lows of HK$1.44. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Xiamen International Port’s current trading price of HK$1.47 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 Xiamen International Port’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change. View our latest analysis for Xiamen International Port
What is Xiamen International Port worth?
Good news, investors! Xiamen International Port is still a bargain right now. My valuation model shows that the intrinsic value for the stock is HK$10.67, but it is currently trading at HK$1.47 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Xiamen International Port’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 Xiamen International Port 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. With revenues expected to grow by a double-digit 22.80% over the next couple of years, the outlook is positive for Xiamen International Port. If the level of expenses is able to be maintained, it looks like higher cash flows 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 Xiamen International Port is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic 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 undervaluation.