Is Now An Opportune Moment To Examine NCC AB (publ) (STO:NCC B)?

While NCC AB (publ) (STO:NCC B) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the OM, rising to highs of kr122 and falling to the lows of kr110. 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 NCC's current trading price of kr110 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 NCC’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for NCC

What's The Opportunity In NCC?

Great news for investors – NCC is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is SEK167.30, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. What’s more interesting is that, NCC’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. 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 does the future of NCC look like?

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. However, with a negative profit growth of -16% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for NCC. This certainty tips the risk-return scale towards higher risk.

What This Means For You

Are you a shareholder? Although NCC B is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. Consider whether you want to increase your portfolio exposure to NCC B, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping an eye on NCC B for a while, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

If you want to dive deeper into NCC, you'd also look into what risks it is currently facing. To that end, you should learn about the 2 warning signs we've spotted with NCC (including 1 which doesn't sit too well with us).

If you are no longer interested in NCC, 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.