What Is Audinate Group Limited's (ASX:AD8) Share Price Doing?

Audinate Group Limited (ASX:AD8), might not be a large cap stock, but it led the ASX gainers with a relatively large price hike in the past couple of weeks. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s examine Audinate Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

See our latest analysis for Audinate Group

What's the opportunity in Audinate Group?

Good news, investors! Audinate Group is still a bargain right now. My valuation model shows that the intrinsic value for the stock is A$9.58, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Audinate Group’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Audinate Group 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. Though in the case of Audinate Group, it is expected to deliver a relatively unexciting earnings growth of 4.7%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for Audinate Group, at least in the near term.

What this means for you:

Are you a shareholder? Even though growth is relatively muted, since AD8 is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on AD8 for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy AD8. 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 buy.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. Every company has risks, and we've spotted 1 warning sign for Audinate Group you should know about.

If you are no longer interested in Audinate Group, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.