Is LiveHire Limited (ASX:LVH) Potentially Undervalued?
LiveHire Limited (ASX:LVH), might not be a large cap stock, but it saw significant share price movement during recent months on the ASX, rising to highs of AU$0.21 and falling to the lows of AU$0.10. 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 LiveHire's current trading price of AU$0.11 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 LiveHire’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for LiveHire
What's The Opportunity In LiveHire?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 11.97% above my intrinsic value, which means if you buy LiveHire today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth A$0.10, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since LiveHire’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
What does the future of LiveHire 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. With profit expected to grow by 78% over the next couple of years, the future seems bright for LiveHire. 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? LVH’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you’ve been keeping an eye on LVH, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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.
If you'd like to know more about LiveHire as a business, it's important to be aware of any risks it's facing. Every company has risks, and we've spotted 3 warning signs for LiveHire you should know about.
If you are no longer interested in LiveHire, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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Find out whether LiveHire is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
LiveHire Limited provides online talent acquisition software solutions to enterprises in Australia, New Zealand, and North America.
Flawless balance sheet with limited growth.