Cypark Resources Berhad (KLSE:CYPARK), might not be a large cap stock, but it received a lot of attention from a substantial price increase on the KLSE over the last few months. Less-covered, small caps tend to present more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Today I will analyse the most recent data on Cypark Resources Berhad’s outlook and valuation to see if the opportunity still exists.
View our latest analysis for Cypark Resources Berhad
Is Cypark Resources Berhad Still Cheap?
Good news, investors! Cypark Resources Berhad is still a bargain right now. According to my valuation, the intrinsic value for the stock is MYR1.37, but it is currently trading at RM0.93 on the share market, meaning that there is still an opportunity to buy now. However, given that Cypark Resources Berhad’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 Cypark Resources Berhad?
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. In Cypark Resources Berhad's case, its revenues over the next couple of years are expected to double, indicating an incredibly optimistic future ahead. If expense does not increase by the same rate, or higher, this top line growth should lead to stronger cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? Since CYPARK 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 CYPARK for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy CYPARK. 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.