Is It Time To Consider Buying Firan Technology Group Corporation (TSE:FTG)?

Firan Technology Group Corporation (TSE:FTG), might not be a large cap stock, but it saw significant share price movement during recent months on the TSX, rising to highs of CA$2.33 and falling to the lows of CA$1.85. 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 Firan Technology Group's current trading price of CA$1.91 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 Firan Technology Group’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 Firan Technology Group

Is Firan Technology Group Still Cheap?

According to my valuation model, Firan Technology Group seems to be fairly priced at around 11% below my intrinsic value, which means if you buy Firan Technology Group today, you’d be paying a reasonable price for it. And if you believe the company’s true value is CA$2.13, then there’s not much of an upside to gain from mispricing. Although, there may be an opportunity to buy in the future. This is because Firan Technology Group’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, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What does the future of Firan Technology Group 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. 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. Firan Technology Group's revenue growth are expected to be in the teens in the upcoming year, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? It seems like the market has already priced in FTG’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on FTG, now may not be the most optimal 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 further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. Every company has risks, and we've spotted 1 warning sign for Firan Technology Group you should know about.

If you are no longer interested in Firan Technology 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.