Tecnoglass Inc. (NYSE:TGLS), might not be a large cap stock, but it led the NYSE gainers with a relatively large price hike in the past couple of weeks. While good news for shareholders, the company has traded much higher in the past year. 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? Let's take a look at Tecnoglass's outlook and value based on the most recent financial data to see if the opportunity still exists.
See our latest analysis for Tecnoglass
What's The Opportunity In Tecnoglass?
Good news, investors! Tecnoglass is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. In this instance, we've used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock's cash flows. we find that Tecnoglass's ratio of 10.81x is below its peer average of 20.13x, which indicates the stock is trading at a lower price compared to the Building industry. What's more interesting is that, Tecnoglass'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 does the future of Tecnoglass look like?
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 profit growth of 8.8% expected over the next couple of years, growth doesn't seem like a key driver for a buy decision for Tecnoglass, at least in the short term.
What This Means For You
Are you a shareholder? Even though growth is relatively muted, since TGLS is currently trading below the industry PE ratio, it may be a great time to increase your holdings in the stock. 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 TGLS for a while, now might be the time to enter the stock. Its future profit outlook isn't fully reflected in the current share price yet, which means it's not too late to buy TGLS. 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 assessment.
If you want to dive deeper into Tecnoglass, you'd also look into what risks it is currently facing. Case in point: We've spotted 1 warning sign for Tecnoglass you should be aware of.
If you are no longer interested in Tecnoglass, 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.