Aristocrat Leisure Limited (ASX:ALL) led the ASX gainers with a relatively large price hike in the past couple of weeks. The company's trading levels have reached its high for the past year, following the recent bounce in the share price. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s take a look at Aristocrat Leisure’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Aristocrat Leisure

What Is Aristocrat Leisure Worth?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 8.3% below our intrinsic value, which means if you buy Aristocrat Leisure today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth A$58.83, then there’s not much of an upside to gain from mispricing. What's more, Aristocrat Leisure’s share price may be more stable over time (relative to the market), as indicated by its low beta.

Can we expect growth from Aristocrat Leisure?

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. With profit expected to grow by a double-digit 12% over the next couple of years, the outlook is positive for Aristocrat Leisure. 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 ALL’s positive outlook, with shares trading around its fair value. 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 the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping tabs on ALL, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.