What Does National Beverage Corp.'s (NASDAQ:FIZZ) Share Price Indicate?

National Beverage Corp. (NASDAQ:FIZZ), is not the largest company out there, but it received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to US$50.03 at one point, and dropping to the lows of US$41.95. 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 National Beverage's current trading price of US$42.05 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at National Beverage’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 National Beverage

What's The Opportunity In National Beverage?

Great news for investors – National Beverage is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is $62.19, 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, National Beverage’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will National Beverage generate?

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. Though in the case of National Beverage, it is expected to deliver a relatively unexciting top-line growth of 5.1% in the next few years, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since FIZZ is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on FIZZ for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy FIZZ. 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.

So while earnings quality is important, it's equally important to consider the risks facing National Beverage at this point in time. In terms of investment risks, we've identified 1 warning sign with National Beverage, and understanding it should be part of your investment process.

If you are no longer interested in National Beverage, 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.