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Jacquet Metal Service SA (EPA:JCQ), a trade distributors company based in France, saw significant share price volatility over the past couple of months on the ENXTPA, rising to the highs of €30 and falling to the lows of €24.15. 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 Jacquet Metal Service’s current trading price of €24.4 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 Jacquet Metal Service’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for Jacquet Metal Service
What is Jacquet Metal Service worth?
According to my valuation model, Jacquet Metal Service seems to be fairly priced at around 3.4% above my intrinsic value, which means if you buy Jacquet Metal Service today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is €23.6, then there isn’t really any room for the share price grow beyond what it’s currently trading. So, is there another chance to buy low in the future? Given that Jacquet Metal Service’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 an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.
What kind of growth will Jacquet Metal Service generate?
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. Jacquet Metal Service’s earnings over the next few years are expected to increase by 23.66%, 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? JCQ’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?