What Is LifeStance Health Group, Inc.'s (NASDAQ:LFST) Share Price Doing?

LifeStance Health Group, Inc. (NASDAQ:LFST), might not be a large cap stock, but it saw a significant share price rise of over 20% in the past couple of months on the NASDAQGS. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on LifeStance Health Group’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for LifeStance Health Group

What Is LifeStance Health Group Worth?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 6.6% below my intrinsic value, which means if you buy LifeStance Health Group today, you’d be paying a fair price for it. And if you believe that the stock is really worth $9.30, then there’s not much of an upside to gain from mispricing. What's more, LifeStance Health Group’s share price may be more stable over time (relative to the market), as indicated by its low beta.

What does the future of LifeStance Health Group look like?

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 60% over the next couple of years, the future seems bright for LifeStance Health Group. 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? LFST’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on LFST, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For example - LifeStance Health Group has 2 warning signs we think you should be aware of.

If you are no longer interested in LifeStance Health Group, 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.