Safe Bulkers, Inc. (NYSE:SB), is not the largest company out there, but it saw significant share price movement during recent months on the NYSE, rising to highs of US$6.15 and falling to the lows of US$4.52. 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 Safe Bulkers' current trading price of US$4.84 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Safe Bulkers’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Safe Bulkers

What's The Opportunity In Safe Bulkers?

The share price seems sensible at the moment according to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average. We’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 5.9x is currently trading slightly below its industry peers’ ratio of 5.9x, which means if you buy Safe Bulkers today, you’d be paying a decent price for it. And if you believe Safe Bulkers should be trading in this range, then there isn’t much room for the share price to grow beyond the levels of other industry peers over the long-term. Furthermore, it seems like Safe Bulkers’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s priced similarly to industry peers. This is because the stock is less volatile than the wider market given its low beta.

Can we expect growth from Safe Bulkers?

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. 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 a double-digit 13% over the next couple of years, the outlook is positive for Safe Bulkers. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? It seems like the market has already priced in SB’s positive outlook, with shares trading around industry price multiples. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at SB? Will you have enough confidence to invest in the company should the price drop below the industry PE ratio?