Should you research China Everbright Environmental Group Limited (HKG:257) at HK$3.11?



China Guangguang Environmental Group Co., Ltd. (HKG:257) may not be a large-cap stock, but it has led the SEHK gainers with a relatively strong price increase over the past few weeks. The recent rise in share price has pushed the company in the right direction, but it’s still well short of its yearly highs. With many analysts covering the mid-cap stock, one might expect price-sensitive announcements to be already factored into the stock price. But what if you still have the opportunity to buy? Today we will analyze the latest data on China Everbright Environmental Group’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for China Light Environment Group.

Is China Guangguang Environmental Group still cheap?

Based on our discounted cash flow valuation, China Guangguang Environmental Group appears to be overvalued by 39% at the moment. The stock’s current market price is HK$3.11, while the company’s intrinsic value is HK$2.24. This means that the opportunity to buy China Guangguang Environmental Group at a good price has disappeared. Another thing to keep in mind is that China Everbright Environment Group’s share price is quite stable compared to the market, as evidenced by its low beta value. This means that if you believe the current stock price will trend toward its intrinsic value over time, a low beta value could suggest that it is unlikely to reach that level anytime soon. This means that once you get there, it can be difficult to get back to that level again. Once again an attractive purchase range.

What kind of growth will China Guangguang Environmental Group generate?

SEHK:257 Earnings and Revenue Growth March 19, 2024

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. While value investors would argue that it’s the intrinsic value relative to the price that matters most, a more compelling investment thesis would be high growth potential at a cheap price. However, with earnings growth expected to be relatively slow at 4.5% over the next few years, growth is unlikely to be a key factor in China Everbright Environmental Group’s acquisition decision, at least in the short term.

what this means for you

Are you a shareholder? 257’s future growth appears to be priced into its current share price, with the stock trading above its fair value. However, this raises another question. Is now a good time to sell? If you believe 257 should trade below its current price, you can profit by selling at a high price and buying it back when the price falls towards its real value. may be obtained. But before you make this decision, check to see if the fundamentals have changed.

Are you a potential investor? If you’ve been watching 257 for a while, now may not be the best time to enter the stock. Price exceeds true value. In other words, there is no profit from mispricing. However, the positive outlook means it’s worth digging deeper into other factors to take advantage of the next price drop.

Considering this, if you want to perform further analysis on a company, it is important to be informed about the risks involved. After doing some research, we found the following: 2 warning signs for China Light Environment Group (1 is a little off-putting!) We think this is worth paying close attention to.

If you are no longer interested in China Guangguang Environmental Group, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Valuation is complex, but we help make it simple.

Check out our comprehensive analysis of whether China Guangguang Environmental Group is potentially overvalued or undervalued. Fair value estimates, risks and caveats, dividends, insider trading, and financial health.

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This article by Simply Wall St is general in nature. We provide commentary using only unbiased methodologies, based on historical data and analyst forecasts, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.

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