AG Mortgage Investment Trust, Inc. (NYSE:MITT), which is in the mortgage reits business, and is based in United States, saw its share price hover around a small range of $15.42 to $16.61 over the last few weeks. But is this actually reflective of the share value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at AG Mortgage Investment Trust’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
What’s the opportunity in AG Mortgage Investment Trust?
Great news for investors – AG Mortgage Investment Trust is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $23.46, but it is currently trading at US$15.70 on the share market, meaning that there is still an opportunity to buy now. AG Mortgage Investment Trust’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.
What does the future of AG Mortgage Investment Trust look like?
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. In AG Mortgage Investment Trust’s case, its revenues over the next few years are expected to grow by 85%, indicating a highly optimistic future ahead. If expense does not increase by the same rate, or higher, this top line growth should lead to stronger cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? Since MITT is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on MITT for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MITT. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on AG Mortgage Investment Trust. You can find everything you need to know about AG Mortgage Investment Trust in the latest infographic research report. If you are no longer interested in AG Mortgage Investment Trust, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.