Thalassa Holdings Limited (AIM:THAL), an energy company based in British Virgin Islands, received a lot of attention from a substantial price increase on the AIM in the over the last few months. Less covered, small-stocks like THAL sees more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could THAL still be trading at a low price relative to its actual value? Let’s take a look at THAL’s outlook and value based on the most recent financial data to see if the opportunity still exists. Check out our latest analysis for Thalassa Holdings
What is THAL worth?Great news for investors – THAL is still trading at a fairly cheap price. I’ve used the price-to-equity ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 11.6x is currently well-below the industry average of 58.4x, meaning that it is trading at a cheaper price relative to its peers. Although, there may be another chance to buy again in the future. This is because THAL’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, THAL’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
What does the future of THAL look like?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 THAL future expectations. Though in the case of THAL, it is expected to deliver a negative revenue growth of -2.87% next year, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? Although THAL is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to THAL, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping tabs on THAL for some time, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Thalassa Holdings. You can find everything you need to know about THAL in the latest infographic research report. If you are no longer interested in Thalassa Holdings, you can use our free platform to see my list of over 50 other stocks with a high growth potential.