AcadeMedia AB (publ) (STO:ACAD), is not the largest company out there, but it saw significant share price movement during recent months on the OM, rising to highs of kr58.00 and falling to the lows of kr47.40. 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 AcadeMedia's current trading price of kr49.30 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 AcadeMedia’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
What's the opportunity in AcadeMedia?
Good news, investors! AcadeMedia is still a bargain right now. My valuation model shows that the intrinsic value for the stock is SEK67.85, but it is currently trading at kr49.30 on the share market, meaning that there is still an opportunity to buy now. However, given that AcadeMedia’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 another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.
What kind of growth will AcadeMedia generate?
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 profit expected to grow by 32% over the next couple of years, the future seems bright for AcadeMedia. 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? Since ACAD is currently undervalued, it may be a great time to increase your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on ACAD for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy ACAD. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.
If you want to dive deeper into AcadeMedia, you'd also look into what risks it is currently facing. You'd be interested to know, that we found 1 warning sign for AcadeMedia and you'll want to know about it.
If you are no longer interested in AcadeMedia, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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.