Is Made Tech Group Plc (LON:MTEC) Potentially Undervalued?

Made Tech Group Plc (LON:MTEC), might not be a large cap stock, but it saw a significant share price rise of 42% in the past couple of months on the AIM. The recent jump in the share price has meant that the company is trading at close to its 52-week high. 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 Made Tech Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

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Is Made Tech Group Still Cheap?

According to our valuation model, Made Tech Group seems to be fairly priced at around 0.72% above our intrinsic value, which means if you buy Made Tech Group today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth £0.38, there’s only an insignificant downside when the price falls to its real value. Furthermore, Made Tech Group’s low beta implies that the stock is less volatile than the wider market.

View our latest analysis for Made Tech Group

What does the future of Made Tech Group look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With revenues expected to grow by a double-digit 28% over the next couple of years, the outlook is positive for Made Tech 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? It seems like the market has already priced in MTEC’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 MTEC, 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.

If you'd like to know more about Made Tech Group as a business, it's important to be aware of any risks it's facing. While conducting our analysis, we found that Made Tech Group has 2 warning signs and it would be unwise to ignore them.

If you are no longer interested in Made Tech 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.