When Should You Buy FastPartner AB (publ) (STO:FPAR A)?

FastPartner AB (publ) (STO:FPAR A), is not the largest company out there, but it led the OM gainers with a relatively large price hike in the past couple of weeks. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. Less-covered, small caps tend to present 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? Today we will analyse the most recent data on FastPartner’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for FastPartner

Is FastPartner Still Cheap?

Great news for investors – FastPartner is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is SEK74.02, but it is currently trading at kr59.20 on the share market, meaning that there is still an opportunity to buy now. However, given that FastPartner’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 FastPartner generate?

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. However, with a relatively muted revenue growth of 7.6% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for FastPartner, at least in the short term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since FPAR A is currently undervalued, it may be a great time to increase your holdings in the stock. 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 FPAR A for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy FPAR A. 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.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For example, FastPartner has 2 warning signs (and 1 which can't be ignored) we think you should know about.

If you are no longer interested in FastPartner, 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.