Is There Now An Opportunity In Insulet Corporation (NASDAQ:PODD)?

Today we're going to take a look at the well-established Insulet Corporation (NASDAQ:PODD). The company's stock received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to US$297 at one point, and dropping to the lows of US$170. 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 Insulet's current trading price of US$170 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Insulet’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Insulet

What Is Insulet Worth?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 8.4% below my intrinsic value, which means if you buy Insulet today, you’d be paying a fair price for it. And if you believe that the stock is really worth $185.20, then there isn’t much room for the share price grow beyond what it’s currently trading. What's more, Insulet’s share price may be more stable over time (relative to the market), as indicated by its low beta.

Can we expect growth from Insulet?

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. Insulet's earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? It seems like the market has already priced in PODD’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. 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 PODD, now may not be the most optimal 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.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. While conducting our analysis, we found that Insulet has 1 warning sign and it would be unwise to ignore it.

If you are no longer interested in Insulet, 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.