Why Thunderbird Entertainment Group Inc. (CVE:TBRD) Could Be Worth Watching

Thunderbird Entertainment Group Inc. (CVE:TBRD), might not be a large cap stock, but it saw a double-digit share price rise of over 10% in the past couple of months on the TSXV. While good news for shareholders, the company has traded much higher in the past year. Less-covered, small caps 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 the stock still be trading at a low price relative to its actual value? Let’s examine Thunderbird Entertainment Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

See our latest analysis for Thunderbird Entertainment Group

Is Thunderbird Entertainment Group Still Cheap?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 9.7% below our intrinsic value, which means if you buy Thunderbird Entertainment Group today, you’d be paying a fair price for it. And if you believe the company’s true value is CA$2.15, then there isn’t much room for the share price grow beyond what it’s currently trading. So, is there another chance to buy low in the future? Given that Thunderbird Entertainment 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 an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Thunderbird Entertainment 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. With revenues expected to grow by a double-digit 14% in the upcoming year, the outlook is positive for Thunderbird Entertainment Group. If the level of expenses is able to be maintained, 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? TBRD’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 tabs on TBRD, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect 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 Thunderbird Entertainment Group as a business, it's important to be aware of any risks it's facing. In terms of investment risks, we've identified 1 warning sign with Thunderbird Entertainment Group, and understanding it should be part of your investment process.

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

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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.

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