While Sunny Optical Technology (Group) Company Limited (HKG:2382) might not have the largest market cap around , it led the SEHK gainers with a relatively large price hike in the past couple of weeks. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s examine Sunny Optical Technology (Group)’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
See our latest analysis for Sunny Optical Technology (Group)
What Is Sunny Optical Technology (Group) Worth?
The stock seems fairly valued at the moment according to our valuation model. It’s trading around 4.3% below our intrinsic value, which means if you buy Sunny Optical Technology (Group) today, you’d be paying a fair price for it. And if you believe that the stock is really worth HK$66.01, then there isn’t much room for the share price grow beyond what it’s currently trading. What's more, Sunny Optical Technology (Group)’s share price may be more stable over time (relative to the market), as indicated by its low beta.
Can we expect growth from Sunny Optical Technology (Group)?
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. Sunny Optical Technology (Group)'s earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? It seems like the market has already priced in 2382’s positive outlook, 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?
Are you a potential investor? If you’ve been keeping tabs on 2382, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
It can be quite valuable to consider what analysts expect for Sunny Optical Technology (Group) from their most recent forecasts. At Simply Wall St, we have the analysts estimates which you can view by clicking here.
If you are no longer interested in Sunny Optical Technology (Group), you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.