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Buzzi Unicem SpA (BIT:BZU), which is in the basic materials business, and is based in Italy, saw significant share price volatility over the past couple of months on the BIT, rising to the highs of €21.18 and falling to the lows of €17.31. 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 Buzzi Unicem’s current trading price of €18.98 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Buzzi Unicem’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 Buzzi Unicem
What is Buzzi Unicem worth?
Good news, investors! Buzzi Unicem is still a bargain right now. According to my valuation, the intrinsic value for the stock is €24.1, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because Buzzi Unicem’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 does the future of Buzzi Unicem look like?
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. Though in the case of Buzzi Unicem, it is expected to deliver a relatively unexciting earnings growth of 7.7%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since BZU is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on BZU for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy BZU. 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.