Should You Think About Buying Entravision Communications Corporation (NYSE:EVC) Now?

Entravision Communications Corporation (NYSE:EVC), is not the largest company out there, but it saw significant share price movement during recent months on the NYSE, rising to highs of US$6.44 and falling to the lows of US$3.85. 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 Entravision Communications' current trading price of US$3.85 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Entravision Communications’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 Entravision Communications

What's The Opportunity In Entravision Communications?

According to my valuation model, Entravision Communications seems to be fairly priced at around 17% below my intrinsic value, which means if you buy Entravision Communications today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $4.61, 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 Entravision Communications’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 Entravision Communications 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 revenue growth of 9.0% expected in the upcoming year, short term growth doesn’t seem like a key driver for a buy decision for Entravision Communications.

What This Means For You

Are you a shareholder? EVC’s 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 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 EVC, 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.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. For example, we've found that Entravision Communications has 6 warning signs (1 can't be ignored!) that deserve your attention before going any further with your analysis.

If you are no longer interested in Entravision Communications, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.