HORNBACH Holding AG & Co. KGaA (ETR:HBH), is not the largest company out there, but it received a lot of attention from a substantial price movement on the XTRA over the last few months, increasing to €86.50 at one point, and dropping to the lows of €71.10. 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 HORNBACH Holding KGaA's current trading price of €72.80 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at HORNBACH Holding KGaA’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for HORNBACH Holding KGaA

Is HORNBACH Holding KGaA Still Cheap?

Good news, investors! HORNBACH Holding KGaA is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. In this instance, we’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. we find that HORNBACH Holding KGaA’s ratio of 7.23x is below its peer average of 20.04x, which indicates the stock is trading at a lower price compared to the Specialty Retail industry. However, given that HORNBACH Holding KGaA’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of HORNBACH Holding KGaA 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. With profit expected to grow by 25% over the next couple of years, the future seems bright for HORNBACH Holding KGaA. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? Since HBH is currently below the industry PE ratio, it may be a great time to accumulate more of 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 price multiple.

Are you a potential investor? If you’ve been keeping an eye on HBH for a while, now might be the time to enter the stock. Its prosperous future profit outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy HBH. 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.

It can be quite valuable to consider what analysts expect for HORNBACH Holding KGaA from their most recent forecasts. Luckily, you can check out what analysts are forecasting by clicking here.

If you are no longer interested in HORNBACH Holding KGaA, 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.