Should You Think About Buying Option Care Health, Inc. (NASDAQ:OPCH) Now?

Option Care Health, Inc. (NASDAQ:OPCH), 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$35.00 at one point, and dropping to the lows of US$27.84. 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 Option Care Health's current trading price of US$28.94 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 Option Care Health’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 Option Care Health

What's The Opportunity In Option Care Health?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 5.5% below my intrinsic value, which means if you buy Option Care Health today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth $30.63, then there isn’t much room for the share price grow beyond what it’s currently trading. Although, there may be an opportunity to buy in the future. This is because Option Care Health’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What kind of growth will Option Care Health 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. 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. However, with a relatively muted profit growth of 9.9% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Option Care Health, at least in the short term.

What This Means For You

Are you a shareholder? It seems like the market has already priced in OPCH’s future outlook, 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 conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on OPCH, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining 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. Every company has risks, and we've spotted 1 warning sign for Option Care Health you should know about.

If you are no longer interested in Option Care Health, 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.