Jiangsu Eastern Shenghong Co.,Ltd. (SZSE:000301), is not the largest company out there, but it saw significant share price movement during recent months on the SZSE, rising to highs of CN¥12.90 and falling to the lows of CN¥10.20. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Jiangsu Eastern ShenghongLtd's current trading price of CN¥10.63 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at Jiangsu Eastern ShenghongLtd's outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Jiangsu Eastern ShenghongLtd

What Is Jiangsu Eastern ShenghongLtd Worth?

The stock seems fairly valued at the moment according to my valuation model. It's trading around 7.35% above my intrinsic value, which means if you buy Jiangsu Eastern ShenghongLtd today, you'd be paying a relatively fair price for it. And if you believe the company's true value is CN¥9.90, there's only an insignificant downside when the price falls to its real value. In addition to this, Jiangsu Eastern ShenghongLtd has a low beta, which suggests its share price is less volatile than the wider market.

What kind of growth will Jiangsu Eastern ShenghongLtd generate?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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 more than double over the next couple of years, the future seems bright for Jiangsu Eastern ShenghongLtd. 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? 000301'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 track record of its management team. 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 000301, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect 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.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. Be aware that Jiangsu Eastern ShenghongLtd is showing 5 warning signs in our investment analysis and 1 of those is a bit unpleasant...

If you are no longer interested in Jiangsu Eastern ShenghongLtd, 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.