Should You Think About Buying Ziff Davis, Inc. (NASDAQ:ZD) Now?

While Ziff Davis, Inc. (NASDAQ:ZD) might not be the most widely known stock at the moment, it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$133 and falling to the lows of US$104. 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 Ziff Davis' current trading price of US$104 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 Ziff Davis’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 Ziff Davis

Is Ziff Davis still cheap?

According to my valuation model, Ziff Davis seems to be fairly priced at around 2.31% above my intrinsic value, which means if you buy Ziff Davis today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is $101.28, then there isn’t really any room for the share price grow beyond what it’s currently trading. Furthermore, Ziff Davis’s low beta implies that the stock is less volatile than the wider market.

What does the future of Ziff Davis look like?

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. Though in the case of Ziff Davis, it is expected to deliver a relatively unexciting earnings growth of 9.3%, 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? It seems like the market has already priced in ZD’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 track record of its management team. 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 tabs on ZD, now may not be the most optimal 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.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. Every company has risks, and we've spotted 4 warning signs for Ziff Davis you should know about.

If you are no longer interested in Ziff Davis, 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.