When Should You Buy bet-at-home.com AG (ETR:ACX)?

bet-at-home.com AG (ETR:ACX), might not be a large cap stock, but it saw significant share price movement during recent months on the XTRA, rising to highs of €28.35 and falling to the lows of €13.64. 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 bet-at-home.com's current trading price of €13.64 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 bet-at-home.com’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 bet-at-home.com

What's the opportunity in bet-at-home.com?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 2.7% below my intrinsic value, which means if you buy bet-at-home.com today, you’d be paying a fair price for it. And if you believe that the stock is really worth €14.01, then there isn’t much room for the share price grow beyond what it’s currently trading. Although, there may be an opportunity to buy in the future. This is because bet-at-home.com’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.

Can we expect growth from bet-at-home.com?

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 bet-at-home.com, it is expected to deliver a highly negative earnings growth in the next few years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.

What this means for you:

Are you a shareholder? ACX seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to de-risk your portfolio. Is your current exposure to the stock beneficial for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping tabs on ACX for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. In addition to this, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help gel your views on ACX should the price fluctuate below its true value.

If you'd like to know more about bet-at-home.com as a business, it's important to be aware of any risks it's facing. Every company has risks, and we've spotted 2 warning signs for bet-at-home.com (of which 1 makes us a bit uncomfortable!) you should know about.

If you are no longer interested in bet-at-home.com, 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.