Yahoo Finance Is It The Right Time To Buy Mediobanca Banca di Credito Finanziario Sp.A. (BIT:MB)?
Mediobanca Banca di Credito Finanziario Sp.A. (BIT:MB), operating in the financial services industry based in Italy, received a lot of attention from a substantial price movement on the BIT over the last few months, increasing to €10.45 at one point, and dropping to the lows of €7.68. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Mediobanca Banca di Credito Finanziario’s current trading price of €7.93 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Mediobanca Banca di Credito Finanziario’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 Mediobanca Banca di Credito Finanziario
Is Mediobanca Banca di Credito Finanziario still cheap?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 17% above my intrinsic value, which means if you buy Mediobanca Banca di Credito Finanziario today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth €6.78, then there isn’t really any room for the share price grow beyond what it’s currently trading. Although, there may be an opportunity to buy in the future. This is because Mediobanca Banca di Credito Finanziario’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
What kind of growth will Mediobanca Banca di Credito Finanziario generate?
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. Though in the case of Mediobanca Banca di Credito Finanziario, it is expected to deliver a negative earnings growth of -0.99%, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? MB seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to reduce the risk in your portfolio. Is your current exposure to the stock optimal for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping an eye on MB for a while, now may not be the most advantageous time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. In addition to this, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help crystalize your views on MB should the price fluctuate below its true value.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Mediobanca Banca di Credito Finanziario. You can find everything you need to know about Mediobanca Banca di Credito Finanziario in the latest infographic research report. If you are no longer interested in Mediobanca Banca di Credito Finanziario, 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.
