JB Hi-Fi Limited (ASX:JBH), is not the largest company out there, but it saw a decent share price growth of 19% on the ASX over the last few months. The recent share price gains has brought the company back closer to its yearly peak. As a mid-cap 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 examine JB Hi-Fi’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

View our latest analysis for JB Hi-Fi

Is JB Hi-Fi Still Cheap?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 14.69% above our intrinsic value, which means if you buy JB Hi-Fi today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is A$80.81, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, JB Hi-Fi’s share price may be more stable over time (relative to the market), as indicated by its low beta.

What does the future of JB Hi-Fi look like?

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. JB Hi-Fi'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 JBH’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 tabs on JBH, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect 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.

If you want to dive deeper into JB Hi-Fi, you'd also look into what risks it is currently facing. You'd be interested to know, that we found 1 warning sign for JB Hi-Fi and you'll want to know about this.

If you are no longer interested in JB Hi-Fi, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.