Is Now The Time To Look At Buying Qt Group Oyj (HEL:QTCOM)?

While Qt Group Oyj (HEL:QTCOM) might not be the most widely known stock at the moment, it received a lot of attention from a substantial price increase on the HLSE over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Qt Group Oyj’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Qt Group Oyj

What's The Opportunity In Qt Group Oyj?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 8.78% above my intrinsic value, which means if you buy Qt Group Oyj today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is €77.83, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since Qt Group Oyj’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What kind of growth will Qt Group 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. With profit expected to grow by 93% over the next couple of years, the future seems bright for Qt Group Oyj. 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? It seems like the market has already priced in QTCOM’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 tabs on QTCOM, 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.

So while earnings quality is important, it's equally important to consider the risks facing Qt Group Oyj at this point in time. Be aware that Qt Group Oyj is showing 4 warning signs in our investment analysis and 1 of those makes us a bit uncomfortable...

If you are no longer interested in Qt Group 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. 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.