At US$18.10, Is Millicom International Cellular S.A. (NASDAQ:TIGO) Worth Looking At Closely?

While Millicom International Cellular S.A. (NASDAQ:TIGO) might not have the largest market cap around , it saw a double-digit share price rise of over 10% in the past couple of months on the NASDAQGS. The recent rally in share prices has nudged the company in the right direction, though it still falls short of its yearly peak. 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, could the stock still be trading at a relatively cheap price? Today we will analyse the most recent data on Millicom International Cellular’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Millicom International Cellular

What's The Opportunity In Millicom International Cellular?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 18.23% above our intrinsic value, which means if you buy Millicom International Cellular today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $15.31, there’s only an insignificant downside when the price falls to its real value. Is there another opportunity to buy low in the future? Since Millicom International Cellular’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. 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 Millicom International Cellular look like?

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. Millicom International Cellular's revenue growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? TIGO’s optimistic 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 financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on TIGO, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you want to dive deeper into Millicom International Cellular, you'd also look into what risks it is currently facing. You'd be interested to know, that we found 1 warning sign for Millicom International Cellular and you'll want to know about this.

If you are no longer interested in Millicom International Cellular, 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.