While Yangzijiang Shipbuilding (Holdings) Ltd. (SGX:BS6) might not be the most widely known stock at the moment, it saw a double-digit share price rise of over 10% in the past couple of months on the SGX. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company's outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let's take a look at Yangzijiang Shipbuilding (Holdings)'s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Yangzijiang Shipbuilding (Holdings)

Is Yangzijiang Shipbuilding (Holdings) still cheap?

Good news, investors! Yangzijiang Shipbuilding (Holdings) is still a bargain right now according to my price multiple model, which compares the company's price-to-earnings ratio to the industry average. I've used the price-to-earnings ratio in this instance because there's not enough visibility to forecast its cash flows. The stock's ratio of 4.81x is currently well-below the industry average of 10.16x, meaning that it is trading at a cheaper price relative to its peers. However, given that Yangzijiang Shipbuilding (Holdings)'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.

What kind of growth will Yangzijiang Shipbuilding (Holdings) 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. With profit expected to grow by 22% over the next couple of years, the future seems bright for Yangzijiang Shipbuilding (Holdings). It looks like higher cash flow 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 BS6 is currently below the industry PE ratio, 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 price multiple.

Are you a potential investor? If you've been keeping an eye on BS6 for a while, now might be the time to enter the stock. Its prosperous future profit outlook isn't fully reflected in the current share price yet, which means it's not too late to buy BS6. 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 investment decision.

If you'd like to know more about Yangzijiang Shipbuilding (Holdings) as a business, it's important to be aware of any risks it's facing. While conducting our analysis, we found that Yangzijiang Shipbuilding (Holdings) has 3 warning signs and it would be unwise to ignore these.

If you are no longer interested in Yangzijiang Shipbuilding (Holdings), 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.