GW Pharmaceuticals plc (NASDAQ:GWPH), a pharmaceuticals company based in United Kingdom, led the NasdaqGM gainers with a relatively large price hike in the past couple of weeks. With many analysts covering the mid-cap 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? Today I will analyse the most recent data on GW Pharmaceuticals’s outlook and valuation to see if the opportunity still exists. View our latest analysis for GW Pharmaceuticals
What’s the opportunity in GW Pharmaceuticals?Great news for investors – GW Pharmaceuticals is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $343.12, but it is currently trading at US$162.01 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, GW Pharmaceuticals’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 kind of growth will GW Pharmaceuticals generate?Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. With profit expected to grow by 72.77% over the next couple of years, the future seems bright for GW Pharmaceuticals. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? Since GWPH is currently undervalued, it may be a great time to increase 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 financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on GWPH for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy GWPH. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on GW Pharmaceuticals. You can find everything you need to know about GW Pharmaceuticals in the latest infographic research report. If you are no longer interested in GW Pharmaceuticals, you can use our free platform to see my list of over 50 other stocks with a high growth potential.