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While Concurrent Technologies Plc (LON:CNC) 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 AIM. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. Less-covered, small caps sees more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Let’s examine Concurrent Technologies’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
What's The Opportunity In Concurrent Technologies?
Concurrent Technologies appears to be overvalued by 29% at the moment, based on our discounted cash flow valuation. The stock is currently priced at UK£1.52 on the market compared to our intrinsic value of £1.17. Not the best news for investors looking to buy! In addition to this, it seems like Concurrent Technologies’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to fall back down to an attractive buying range, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
See our latest analysis for Concurrent Technologies
What kind of growth will Concurrent Technologies 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. With profit expected to grow by 51% over the next couple of years, the future seems bright for Concurrent Technologies. 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? CNC’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? If you believe CNC should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.