Stock Analysis

When Should You Buy AgroFresh Solutions, Inc. (NASDAQ:AGFS)?

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NasdaqGS:AGFS
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AgroFresh Solutions, Inc. (NASDAQ:AGFS), might not be a large cap stock, but it saw a decent share price growth in the teens level on the NASDAQGS over the last few months. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at AgroFresh Solutions’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for AgroFresh Solutions

Is AgroFresh Solutions still cheap?

Great news for investors – AgroFresh Solutions is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $3.32, but it is currently trading at US$2.34 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, AgroFresh Solutions’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of AgroFresh Solutions look like?

earnings-and-revenue-growth
NasdaqGS:AGFS Earnings and Revenue Growth December 18th 2020

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. In the upcoming year, AgroFresh Solutions' earnings are expected to increase by 64%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since AGFS is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on AGFS for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy AGFS. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Case in point: We've spotted 2 warning signs for AgroFresh Solutions you should be aware of.

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