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Everi Holdings Inc (NYSE:EVRI), a it company based in United States, saw significant share price volatility over the past couple of months on the NYSE, rising to the highs of $7.96 and falling to the lows of $6.2. 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 Everi Holdings’s current trading price of $6.25 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 Everi Holdings’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 Everi Holdings
What’s the opportunity in Everi Holdings?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 2% above my intrinsic value, which means if you buy Everi Holdings today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is $6.1, then there isn’t really any room for the share price grow beyond what it’s currently trading. So, is there another chance to buy low in the future? Given that Everi Holdings’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.
What kind of growth will Everi Holdings generate?
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 grow by 89.41% over the next year, the near-term future seems bright for Everi Holdings. It looks like higher cash flows 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 EVRI’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 financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?