Impax Laboratories Inc (NASDAQ:IPXL), a pharmaceuticals, biotechnology and life sciences company based in United States, led the NasdaqGS gainers with a relatively large price hike in the past couple of weeks. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s take a look at IPXL’s outlook and value based on the most recent financial data to see if the opportunity still exists. View our latest analysis for Impax Laboratories

What's the opportunity in IPXL?

According to my valuation model, IPXL seems to be fairly priced at around 12% below my intrinsic value, which means if you buy IPXL today, you’d be paying a fair price for it. And if you believe IPXL’s true value is $24.49, then there isn’t much room for the share price grow beyond what it’s currently trading. Although, there may be an opportunity to buy in the future. This is because IPXL’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, IPXL’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

Can we expect growth from IPXL?

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 91.54% over the next year, the near-term future seems bright for IPXL. 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? IPXL’s optimistic future growth appears to have been factored into the current share price, 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 IPXL? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping tabs on IPXL, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for IPXL, 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.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Impax Laboratories. You can find everything you need to know about IPXL in the latest infographic research report. If you are no longer interested in Impax Laboratories, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.