Today we're going to take a look at the well-established Pilgrim's Pride Corporation (NASDAQ:PPC). The company's stock saw a significant share price rise of 21% in the past couple of months on the NASDAQGS. The company is inching closer to its yearly highs following the recent share price climb. As a large-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, could the stock still be trading at a relatively cheap price? Let’s take a look at Pilgrim's Pride’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for Pilgrim's Pride

Is Pilgrim's Pride Still Cheap?

According to our valuation model, Pilgrim's Pride seems to be fairly priced at around 19% below our intrinsic value, which means if you buy Pilgrim's Pride today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $66.71, then there isn’t much room for the share price grow beyond what it’s currently trading. In addition to this, Pilgrim's Pride has a low beta, which suggests its share price is less volatile than the wider market.

Can we expect growth from Pilgrim's Pride?

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. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Pilgrim's Pride, at least in the near future.

What This Means For You

Are you a shareholder? Currently, PPC appears to be trading around its fair value, 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 PPC 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. Furthermore, 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 gel your views on PPC should the price fluctuate below its true value.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. You'd be interested to know, that we found 1 warning sign for Pilgrim's Pride and you'll want to know about this.

If you are no longer interested in Pilgrim's Pride, 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.