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Macerich Company ( NYSE:MAC ), which is in the reits business, and is based in United States, saw significant share price movement during recent months on the NYSE, rising to highs of $44.22 and falling to the lows of $34.53. 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 Macerich's current trading price of $35.14 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Macerich’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
What's the opportunity in Macerich?
Good news, investors! Macerich is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $49.33, but it is currently trading at US$35.14 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Macerich’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
What kind of growth will Macerich generate?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Macerich, at least in the near future.
What this means for you:
Are you a shareholder? Although MAC is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to MAC, 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 MAC for some time, but hesitant on making the leap, I 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Macerich. You can find everything you need to know about Macerich in the latest infographic research report . If you are no longer interested in Macerich, you can use our free platform to see my list of over 50 other stocks with a high growth potential .
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.