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Plymouth Industrial REIT, Inc. (NYSEMKT:PLYM), which is in the reits business, and is based in United States, saw a decent share price growth in the teens level on the AMEX over the last few months. 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? Let’s examine Plymouth Industrial REIT’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
Is Plymouth Industrial REIT still cheap?
Good news, investors! Plymouth Industrial REIT is still a bargain right now. According to my valuation, the intrinsic value for the stock is $38.47, but it is currently trading at US$19.48 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Plymouth Industrial REIT’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
What does the future of Plymouth Industrial REIT look like?
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 grow by a double-digit 12% in the upcoming year, the short-term outlook is positive for Plymouth Industrial REIT. 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? Since PLYM is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on PLYM for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy PLYM. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Plymouth Industrial REIT. You can find everything you need to know about Plymouth Industrial REIT in the latest infographic research report. If you are no longer interested in Plymouth Industrial REIT, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.