While Hyster-Yale Materials Handling, Inc. (NYSE:HY) 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 NYSE. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Today I will analyse the most recent data on Hyster-Yale Materials Handling's outlook and valuation to see if the opportunity still exists.
Check out our latest analysis for Hyster-Yale Materials Handling
What's The Opportunity In Hyster-Yale Materials Handling?
Good news, investors! Hyster-Yale Materials Handling is still a bargain right now. According to my valuation, the intrinsic value for the stock is $57.53, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. What's more interesting is that, Hyster-Yale Materials Handling's share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
What kind of growth will Hyster-Yale Materials Handling generate?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. However, with an extremely negative double-digit change in profit expected next year, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Hyster-Yale Materials Handling, at least in the near future.
What This Means For You
Are you a shareholder? Although HY is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. Consider whether you want to increase your portfolio exposure to HY, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you've been keeping tabs on HY for some time, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
If you'd like to know more about Hyster-Yale Materials Handling as a business, it's important to be aware of any risks it's facing. At Simply Wall St, we found 2 warning signs for Hyster-Yale Materials Handling and we think they deserve your attention.
If you are no longer interested in Hyster-Yale Materials Handling, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.