Is It Too Late To Consider Buying MakeMyTrip Limited (NASDAQ:MMYT)?

MakeMyTrip Limited (NASDAQ:MMYT), is not the largest company out there, but it received a lot of attention from a substantial price increase on the NASDAQGS over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Let’s examine MakeMyTrip’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

View our latest analysis for MakeMyTrip

What Is MakeMyTrip Worth?

The stock is currently trading at US$36.81 on the share market, which means it is overvalued by 40% compared to my intrinsic value of $26.34. This means that the opportunity to buy MakeMyTrip at a good price has disappeared! If you like the stock, you may want to keep an eye out for a potential price decline in the future. Given that MakeMyTrip’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 does the future of MakeMyTrip look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. With profit expected to more than double over the next couple of years, the future seems bright for MakeMyTrip. 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? It seems like the market has well and truly priced in MMYT’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe MMYT should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on MMYT for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for MMYT, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

It can be quite valuable to consider what analysts expect for MakeMyTrip from their most recent forecasts. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in MakeMyTrip, 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.