Is It Too Late To Consider Buying LightPath Technologies, Inc. (NASDAQ:LPTH)?

While LightPath Technologies, Inc. (NASDAQ:LPTH) might not be the most widely known stock at the moment, it led the NASDAQCM gainers with a relatively large price hike in the past couple of weeks. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Today I will analyse the most recent data on LightPath Technologies’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for LightPath Technologies

What is LightPath Technologies worth?

Good news, investors! LightPath Technologies is still a bargain right now. According to my valuation, the intrinsic value for the stock is $5.78, but it is currently trading at US$3.92 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because LightPath Technologies’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.

Can we expect growth from LightPath Technologies?

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. However, with a relatively muted profit growth of 3.0% expected over the next year, growth doesn’t seem like a key driver for a buy decision for LightPath Technologies, at least in the short term.

What this means for you:

Are you a shareholder? Even though growth is relatively muted, since LPTH is currently undervalued, it may be a great time to increase your holdings in the stock. 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 LPTH for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy LPTH. 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.

If you want to dive deeper into LightPath Technologies, you'd also look into what risks it is currently facing. For example - LightPath Technologies has 1 warning sign we think you should be aware of.

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This article by Simply Wall St is general in nature. 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.
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