Is it time to consider buying Gibraltar Industries, Inc. (NASDAQ:ROCK)?

While Gibraltar Industries, Inc. (NASDAQ:ROCK) may not be the best-known stock right now, it has seen decent teen-level stock price growth on the NASDAQGS over the past few months. With plenty of analysts covering the stock, we can expect any price-sensitive announcements to have already factored into the stock price. However, could the stock still trade at a relatively cheap price? Let’s take a look at the outlook and value of Gibraltar Industries based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Gibraltar Industries

What is the opportunity in Gibraltar Industries?

The stock price looks reasonable at the moment based on my multiple price model, where I compare the company’s price-earnings ratio to the industry average. In this case, I used the Price/Earnings (PE) ratio since there is not enough information to reliably predict the stock’s cash flow. I find that Gibraltar Industries’ ratio of 16.94x is trading slightly above its industry peers’ ratio of 14.78x, which means that if you buy Gibraltar Industries today you will pay a price relatively reasonable. And if you believe that Gibraltar Industries should trade at this level for the long term, then there should only be a fairly intangible downside compared to other industry peers. Although there may be an opportunity to buy in the future. This is because Gibraltar Industries’ beta (a measure of stock price volatility) is high, meaning that its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s stock will likely fall more than the rest of the market, providing an excellent buying opportunity.

What does the future of Gibraltar Industries look like?

NasdaqGS: ROCK Earnings and Revenue Growth October 9, 2022

Investors looking for portfolio growth may want to consider a company’s prospects before buying its stock. Buying a big company with solid prospects at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. With profits expected to increase by 32% over the next year, the near-term future looks bright for Gibraltar Industries. It seems that a higher cash flow is expected for the stock, which should translate into a higher valuation of the stock.

What this means for you

Are you a shareholder? It looks like the market has already priced in the positive outlook for ROCK, with stocks 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 watched ROCK? Will you have enough conviction to buy if the price moves below the industry PE ratio?

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

Diving deeper into the forecast for Gibraltar Industries mentioned earlier will help you understand how analysts view the stock going forward. Then do not hesitate to consult our free graph representing the forecasts of the analysts.

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

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.

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