Yahoo Finance Should You Investigate Snap-on Incorporated (NYSE:SNA) At US$275?
Let's talk about the popular Snap-on Incorporated (NYSE:SNA). The company's shares received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$297 at one point, and dropping to the lows of US$262. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Snap-on's current trading price of US$275 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Snap-on’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
View our latest analysis for Snap-on
What Is Snap-on Worth?
Good news, investors! Snap-on is still a bargain right now. According to our valuation, the intrinsic value for the stock is $344.87, but it is currently trading at US$275 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Snap-on’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 kind of growth will Snap-on generate?
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. Though in the case of Snap-on, it is expected to deliver a relatively unexciting earnings growth of 5.1%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What This Means For You
Are you a shareholder? Even though growth is relatively muted, since SNA 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 capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on SNA 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 SNA. 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 investment decision.
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. Every company has risks, and we've spotted 1 warning sign for Snap-on you should know about.
If you are no longer interested in Snap-on, 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.
