Yahoo Finance Why National Express Group PLC (LON:NEX) Could Be Worth Watching
National Express Group PLC (LON:NEX), which is in the transportation business, and is based in United Kingdom, received a lot of attention from a substantial price increase on the LSE over the last few months. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s take a look at National Express Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for National Express Group
What's the opportunity in National Express Group?
Good news, investors! National Express Group is still a bargain right now. My valuation model shows that the intrinsic value for the stock is £3.29, but it is currently trading at UK£2.11 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, National Express Group’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.
Can we expect growth from National Express Group?
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. 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. However, with a relatively muted profit growth of 6.4% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for National Express Group, at least in the short term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since NEX 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 NEX for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy NEX. 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 National Express Group. You can find everything you need to know about National Express Group in the latest infographic research report. If you are no longer interested in National Express Group, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
Love or hate this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.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. 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. Thank you for reading.
