Let's talk about the popular Standard Chartered PLC (LON:STAN). The company's shares received a lot of attention from a substantial price movement on the LSE over the last few months, increasing to UK£7.39 at one point, and dropping to the lows of UK£6.51. 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 Standard Chartered's current trading price of UK£6.99 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 Standard Chartered’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
What is Standard Chartered worth?
Good news, investors! Standard Chartered is still a bargain right now. My valuation model shows that the intrinsic value for the stock is £9.47, but it is currently trading at UK£6.99 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Standard Chartered’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. 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.
What kind of growth will Standard Chartered generate?
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. Standard Chartered’s earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? Since STAN 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 financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on STAN for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy STAN. 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Standard Chartered. You can find everything you need to know about Standard Chartered in the latest infographic research report. If you are no longer interested in Standard Chartered, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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.
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