Will the 300p Saga share price ever return to £8?

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Investors have been rushing to the Saga (LSE: SAGA) share price during the past few weeks. Following the completion of the company’s fundraising, the stock has jumped by more than 100% in just a few weeks. And I think this could be just the start of a long rally for the stock. That’s why I’m considering adding the shares to my portfolio today. 5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Saga share price performance I think it is fair to say 2020 was not the year Saga was expecting. The company, which has been trying to turn itself around for seven years, was betting that the launch of its new cruise business would help return it to growth. Unfortunately, with the new fleet, and the rest of the cruise ship industry mothballed for 2020, this hasn’t happened. So, management has had to get radical. Saga undertook a huge capital raising to strengthen its balance sheet. At the same time, a management clear-out brought new and old blood back to the board. Positive trends have also started to develop in the group’s non-cruise businesses. These divisions have been a thorn in the side of the company for some time. However, green shoots are starting to show. This is highly encouraging. While 2020 has mostly been a washout for the organisation’s new cruise business, other divisions have begun to pick up the slack after years of problems. These trends suggest to me that when the world is back up and running, the Saga share price may take off. The combination of new sales from the cruise business, as well as growth in existing divisions, could provide some significant growth tailwinds. Growth tailwindsIt’s difficult for me to predict, at this stage, what sort of growth the company will be able to achieve going forward. However, City analysts reckon the firm will report earnings per share of 37p for its 2022 financial year. Compared to the current stock price of 300p, this suggests the shares look cheap at current levels. That being said, there’s no guarantee the company will hit analysts’ projections. A lot could go wrong between now and 2022. However, I think the predictions clearly show the Saga share price’s potential. In the best-case scenario, analysts reckon the group could earn up to 70p per share for 2022. Either way, it seems to me as if the stock is deeply undervalued at current levels and offers a wide margin of safety. That’s why I’m considering the investment for my portfolio today. In the base-case scenario, the stock looks cheap, and in the best-case scenario, it looks even cheaper. Based on these projections, I think the Saga share price offers an attractive risk-reward profile. That’s exactly what I’m looking for when making an investment — the potential for large capital gains and minimal risk of loss at the same time.  Click here to claim your copy of this special investment report — and we’ll tell you the name of this Top Small-Cap Stock… free of charge! Will the 300p Saga share price ever return to £8? Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.center_img The high-calibre small-cap stock flying under the City’s radar I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Image source: Getty Images Rupert Hargreaves | Sunday, 22nd November, 2020 | More on: SAGA Enter Your Email Address See all posts by Rupert Hargreaveslast_img read more