Yahoo Finance What Is RBC Bearings Incorporated’s (NASDAQ:ROLL) Share Price Doing?
RBC Bearings Incorporated (NASDAQ:ROLL), a machinery company based in United States, received a lot of attention from a substantial price increase on the NasdaqGS over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s take a look at RBC Bearings’s outlook and value based on the most recent financial data to see if the opportunity still exists.
Check out our latest analysis for RBC Bearings
What’s the opportunity in RBC Bearings?
RBC Bearings appears to be overvalued by 43.15% at the moment, based on my discounted cash flow valuation. The stock is currently priced at US$148 on the market compared to my intrinsic value of $103.68. This means that the opportunity to buy RBC Bearings at a good price has disappeared! But, is there another opportunity to buy low in the future? Given that RBC Bearings’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.
Can we expect growth from RBC Bearings?
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. In the upcoming year, RBC Bearings’s earnings are expected to increase by 30.54%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in ROLL’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe ROLL should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping tabs on ROLL for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for ROLL, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on RBC Bearings. You can find everything you need to know about RBC Bearings in the latest infographic research report. If you are no longer interested in RBC Bearings, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
