In This Article:
FAT Brands Inc. (NASDAQ:FAT), is not the largest company out there, but it saw significant share price movement during recent months on the NASDAQCM, rising to highs of US$8.60 and falling to the lows of US$5.50. 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 FAT Brands' current trading price of US$5.52 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 FAT Brands’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 FAT Brands
What Is FAT Brands Worth?
Great news for investors – FAT Brands is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is $7.65, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that FAT Brands’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 FAT Brands 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. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. In the upcoming year, FAT Brands' earnings are expected to increase by 59%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? Since FAT is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on FAT for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy FAT. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.