When Should You Buy Admicom Oyj (HEL:ADMCM)?

Admicom Oyj (HEL:ADMCM), is not the largest company out there, but it saw significant share price movement during recent months on the HLSE, rising to highs of €140 and falling to the lows of €91.00. 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 Admicom Oyj's current trading price of €97.00 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 Admicom Oyj’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 Admicom Oyj

What's the opportunity in Admicom Oyj?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 4.39% above my intrinsic value, which means if you buy Admicom Oyj today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is €92.92, there’s only an insignificant downside when the price falls to its real value. So, is there another chance to buy low in the future? Given that Admicom Oyj’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 kind of growth will Admicom Oyj generate?

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. Admicom Oyj's earnings over the next few years are expected to increase by 96%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? ADMCM’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 track record of its management team. 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 ADMCM, 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 diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. In terms of investment risks, we've identified 1 warning sign with Admicom Oyj, and understanding this should be part of your investment process.

If you are no longer interested in Admicom Oyj, 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. 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.
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