MEG Energy Corp (TSX:MEG), an energy company based in Canada, received a lot of attention from a substantial price increase on the TSX in the over the last few months. With many analysts covering the 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 MEG’s outlook and value based on the most recent financial data to see if the opportunity still exists. Check out our latest analysis for MEG Energy
What's the opportunity in MEG?
Good news, investors! MEG is still a bargain right now. According to my valuation, the intrinsic value for the stock is $18.67 which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that MEG’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 MEG?
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 MEG future expectations. With profit expected to grow by 67.26% over the next couple of years, the future seems bright for MEG. It looks like higher cash flows 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 MEG is currently undervalued, it may be a great time to increase your holdings in the stock. With a positive 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 capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on MEG for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MEG. 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on MEG Energy. You can find everything you need to know about MEG in the latest infographic research report. If you are no longer interested in MEG Energy, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass 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.