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Altitude Group plc (LON:ALT), is not the largest company out there, but it saw significant share price movement during recent months on the AIM, rising to highs of UK£0.46 and falling to the lows of UK£0.33. 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 Altitude Group's current trading price of UK£0.33 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 Altitude Group’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Altitude Group
What Is Altitude Group Worth?
According to our valuation model, Altitude Group seems to be fairly priced at around 14% below our intrinsic value, which means if you buy Altitude Group today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth £0.38, then there’s not much of an upside to gain from mispricing. So, is there another chance to buy low in the future? Given that Altitude Group’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 an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.
Can we expect growth from Altitude Group?
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. With profit expected to more than double over the next couple of years, the future seems bright for Altitude Group. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
What This Means For You
Are you a shareholder? It seems like the market has already priced in ALT’s positive outlook, with shares trading around its fair value. 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 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 an eye on ALT, now may not be the most optimal 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 further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.