Heritage-Crystal Clean Inc (NASDAQ:HCCI), a commercial services and supplies company based in United States, received a lot of attention from a substantial price movement on the NasdaqGS in the over the last few months, increasing to $22 at one point, and dropping to the lows of $18.3. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether HCCI’s current trading price of $19.4 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 HCCI’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 Heritage-Crystal Clean

What is HCCI worth?

Great news for investors – HCCI is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $26.49, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that HCCI’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of HCCI look like?

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 negative profit growth of -3.87% expected next year, near-term growth certainly doesn’t appear to be a driver for a buy decision for HCCI. This certainty tips the risk-return scale towards higher risk.

What this means for you:

Are you a shareholder? Although HCCI is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to HCCI, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping an eye on HCCI for a while, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.