At US$18.38, Is It Time To Put Marten Transport, Ltd. (NASDAQ:MRTN) On Your Watch List?

While Marten Transport, Ltd. (NASDAQ:MRTN) might not have the largest market cap around , it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$21.32 and falling to the lows of US$18.38. 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 Marten Transport's current trading price of US$18.38 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 Marten Transport’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 Marten Transport

What Is Marten Transport Worth?

The share price seems sensible at the moment according to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average. We’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 21.24x is currently trading slightly below its industry peers’ ratio of 24.23x, which means if you buy Marten Transport today, you’d be paying a reasonable price for it. And if you believe that Marten Transport should be trading at this level in the long run, then there’s not much of an upside to gain over and above other industry peers. In addition to this, it seems like Marten Transport’s share price is quite stable, which could mean there may be less chances to buy low in the future now that it’s trading around the price multiples of other industry peers. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will Marten Transport 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. However, with a relatively muted revenue growth of 2.5% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Marten Transport, at least in the short term.

What This Means For You

Are you a shareholder? MRTN’s future growth appears to have been factored into the current share price, with shares trading around industry price multiples. 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 MRTN? Will you have enough conviction to buy should the price fluctuate below the the industry PE ratio?

Are you a potential investor? If you’ve been keeping an eye on MRTN, now may not be the most optimal time to buy, given it is trading around industry price multiples. However, the positive growth outlook may mean it’s worth diving deeper into other factors in order to take advantage of the next price drop.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. Every company has risks, and we've spotted 1 warning sign for Marten Transport you should know about.

If you are no longer interested in Marten Transport, 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.