Should You Investigate Galliford Try Holdings plc (LON:GFRD) At UK£4.14?

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a day ago

Galliford Try Holdings plc (LON:GFRD), is not the largest company out there, but it received a lot of attention from a substantial price increase on the LSE over the last few months. The recent jump in the share price has meant that the company is trading at close to its 52-week high. As a 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 Galliford Try Holdings's outlook and value based on the most recent financial data to see if the opportunity still exists.
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Good news, investors! Galliford Try Holdings is still a bargain right now. Our valuation model shows that the intrinsic value for the stock is £6.68, but it is currently trading at UK£4.14 on the share market, meaning that there is still an opportunity to buy now. Galliford Try Holdings's share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it's there, it may be hard to fall back down into an attractive buying range.
View our latest analysis for Galliford Try Holdings
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. Though in the case of Galliford Try Holdings, it is expected to deliver a negative earnings growth of -19%, which doesn't help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
Are you a shareholder? Although GFRD is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. We recommend you think about whether you want to increase your portfolio exposure to GFRD, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you've been keeping tabs on GFRD for some time, but hesitant on making the leap, we recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. To that end, you should learn about the 2 warning signs we've spotted with Galliford Try Holdings (including 1 which is significant).
If you are no longer interested in Galliford Try Holdings, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.