When Should You Buy Littelfuse, Inc. (NASDAQ:LFUS)?
Littelfuse, Inc. (NASDAQ:LFUS), might not be a large cap stock, but it led the NASDAQGS gainers with a relatively large price hike in the past couple of weeks. 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, what if the stock is still a bargain?
Let’s examine Littelfuse’s valuation and outlook in more detail to determine if there’s still a bargain opportunity. Check out our latest analysis for Littelfuse
What Is Littelfuse Worth?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 3.1% below my intrinsic value, which means if you buy Littelfuse today, you’d be paying a fair price for it.
And if you believe the company’s true value is £271.07, then there isn’t much room for the share price grow beyond what it’s currently trading. Is there another opportunity to buy low in the future? Since Littelfuse’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy.
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.
Can we expect growth from Littelfuse?
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. Littelfuse’s earnings growth are expected to be in the teens in the upcoming years, indicating a solid future ahead.
This should lead to robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? It seems like the market has already priced in LFUS’s positive outlook, 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 an eye on LFUS, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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.
It can be quite valuable to consider what analysts expect for Littelfuse from their most recent forecasts. So feel free to check out our free graph representing analyst forecasts. If you are no longer interested in Littelfuse, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Valuation is complex, but we’re helping make it simple.
Find out whether Littelfuse is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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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.
