Today we’re going to take a look at the well-established Old Dominion Freight Line, Inc. (NASDAQ:ODFL). The company’s stock saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$232 and falling to the lows of US$176. 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 Old Dominion Freight Line’s current trading price of US$181 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Old Dominion Freight Line’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for Old Dominion Freight Line
According to our valuation model, Old Dominion Freight Line seems to be fairly priced at around 19.78% above our intrinsic value, which means if you buy Old Dominion Freight Line today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $150.84, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since Old Dominion Freight Line’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
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 24% over the next couple of years, the future seems bright for Old Dominion Freight Line. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
Are you a shareholder? ODFL’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
