Beacon Roofing Supply, Inc. (NASDAQ:BECN), is not the largest company out there, but it led the NASDAQGS gainers with a relatively large price hike in the past couple of weeks. The company is inching closer to its yearly highs following the recent share price climb. 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. However, could the stock still be trading at a relatively cheap price? Today we will analyse the most recent data on Beacon Roofing Supply's outlook and valuation to see if the opportunity still exists.
View our latest analysis for Beacon Roofing Supply
Is Beacon Roofing Supply Still Cheap?
Great news for investors – Beacon Roofing Supply is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is $111.13, but it is currently trading at US$84.98 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Beacon Roofing Supply's beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Can we expect growth from Beacon Roofing Supply?
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 a relatively muted revenue growth of 8.3% expected over the next couple of years, growth doesn't seem like a key driver for a buy decision for Beacon Roofing Supply, at least in the short term.
What This Means For You
Are you a shareholder? Even though growth is relatively muted, since BECN is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you've been keeping an eye on BECN for a while, now might be the time to make a leap. Its future outlook isn't fully reflected in the current share price yet, which means it's not too late to buy BECN. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.
In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. You'd be interested to know, that we found 2 warning signs for Beacon Roofing Supply and you'll want to know about them.
If you are no longer interested in Beacon Roofing Supply, 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.