Should You Think About Buying Accell Group N.V. (AMS:ACCEL) Now?

Accell Group N.V. (AMS:ACCEL), might not be a large cap stock, but it saw a double-digit share price rise of over 10% in the past couple of months on the ENXTAM. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s take a look at Accell Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Accell Group

What is Accell Group worth?

According to my valuation model, Accell Group seems to be fairly priced at around 7.8% below my intrinsic value, which means if you buy Accell Group today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth €29.39, 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 Accell 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.

Can we expect growth from Accell Group?

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. 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. Accell Group's earnings over the next few years are expected to increase by 36%, 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? ACCEL’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 conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on ACCEL, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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 Accell Group as a business, it's important to be aware of any risks it's facing. To that end, you should learn about the 2 warning signs we've spotted with Accell Group (including 1 which makes us a bit uncomfortable).

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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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