Yahoo Finance At $0.158, Is Serial System Ltd (SGX:S69) A Buy?
Serial System Ltd (SGX:S69), a electronic company based in Singapore, had a relatively subdued couple of weeks in terms of changes in share price, which continued to float around the range of SGD0.16 to SGD0.17. However, is this the true valuation level of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Serial System’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change. Check out our latest analysis for Serial System
What is Serial System worth?
According to my valuation model, the stock is currently overvalued by about 53%, trading at S$0.16 compared to my intrinsic value of SGD0.1. Not the best news for investors looking to buy! Furthermore, Serial System’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.
What does the future of Serial System look like?
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. 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. With profit expected to grow by 27.13% over the next couple of years, the future seems bright for Serial System. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in S69’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe S69 should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping an eye on S69 for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the optimistic prospect is encouraging for S69, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Serial System. You can find everything you need to know about Serial System in the latest infographic research report. If you are no longer interested in Serial System, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
