Should You Investigate Modern Times Group Mtg AB (STO:MTG B) At kr111?

While Modern Times Group Mtg AB (STO:MTG 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 kr131 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 Modern Times Group Mtg's current trading price of kr111 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 Modern Times Group Mtg’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Modern Times Group Mtg

Is Modern Times Group Mtg still cheap?

Good news, investors! Modern Times Group Mtg is still a bargain right now. My valuation model shows that the intrinsic value for the stock is SEK171.31, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Modern Times Group Mtg’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

Can we expect growth from Modern Times Group Mtg?

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. In Modern Times Group Mtg's case, its revenues over the next few years are expected to grow by 78%, indicating a highly optimistic future ahead. If expense does not increase by the same rate, or higher, this top line growth should lead to stronger cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since MTG B is currently undervalued, it may be a great time to increase your holdings in the stock. With an optimistic 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 MTG B for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy MTG B. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. In terms of investment risks, we've identified 1 warning sign with Modern Times Group Mtg, and understanding it should be part of your investment process.

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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.
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