Columbia sportswear

Is it time to consider buying Columbia Sportswear Company (NASDAQ:COLM)?

Although Columbia Sportswear Company (NASDAQ:COLM) may not be the best-known stock right now, it has garnered a lot of attention due to a substantial price movement on the NASDAQGS over the past months, rising to US$107 at one point, and falling as low as US$90.89. Certain movements in the stock price can give investors a better opportunity to get into the stock and potentially buy at a lower price. One question to answer is does Columbia Sportswear’s current price of US$94.91 reflect the true value of mid cap? Or is it currently undervalued, giving us the opportunity to buy? Let’s take a look at Columbia Sportswear’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Is Columbia Sportswear still cheap?

According to my multiple price model, which compares the company’s price-earnings ratio to the industry average, the stock price seems justified. I used the price/earnings ratio in this case because there is not enough visibility to predict its cash flow. The stock ratio of 21.13x is currently trading slightly above its industry peers’ ratio of 17.93x, which means that if you buy Columbia Sportswear today, you would pay a relatively reasonable price for it. . And if you think Columbia Sportswear should be trading within this range, then there’s not much room for the stock price to rise above the levels of other industry peers over the long term. On the other hand, the Columbia Sportswear stock price also seems relatively stable compared to the rest of the market, as indicated by its low beta. This may mean that the stock is less likely to fall due to natural market volatility, suggesting fewer buying opportunities in the future.

What does the future of Columbia Sportswear look like?

NasdaqGS: COLM Earnings and Revenue Growth January 6, 2022

Investors looking for portfolio growth may want to consider a company’s prospects before buying its stock. Although value investors argue that it is intrinsic value relative to price that matters most, a more compelling investment thesis would be high growth potential at a cheap price. With profits expected to increase 65% over the next two years, the future looks bright for Columbia Sportswear. It seems that a higher cash flow is expected for the stock, which should translate into a higher valuation of the stock.

What does this mean to you :

Are you a shareholder? COLM’s optimistic future growth appears to have been priced into the current share price, with shares trading around industry price multiples. However, there are also other important factors that we haven’t considered today, such as the background of its management team. Have these factors changed since the last time you consulted COLM? Will you be confident enough to invest in the company if the price drops below the industry PE ratio?

Are you a potential investor? If you’ve been keeping an eye on COLM, now might not be the most optimal time to buy, given that it’s trading around industry price multiples. However, the optimistic forecast is encouraging for COLM, which means that it is worth looking further into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

In light of this, if you want to do more analysis on the company, it is essential to be aware of the risks involved. For example – Columbia Sportswear has 1 warning sign we think you should know.

If you are no longer interested in Columbia Sportswear, you can use our free platform to view our list of over 50 other stocks with high growth potential.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.