In This Article:
While Enthusiast Gaming Holdings Inc. (TSE:EGLX) might not have the largest market cap around , it saw a decent share price growth of 18% on the TSX over the last few months. 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 take a look at Enthusiast Gaming Holdings’s outlook and value based on the most recent financial data to see if the opportunity still exists.
What's The Opportunity In Enthusiast Gaming Holdings?
Good news, investors! Enthusiast Gaming Holdings is still a bargain right now. Our valuation model shows that the intrinsic value for the stock is CA$0.16, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. What’s more interesting is that, Enthusiast Gaming Holdings’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
View our latest analysis for Enthusiast Gaming Holdings
What kind of growth will Enthusiast Gaming 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 94% over the next year, the near-term future seems bright for Enthusiast Gaming Holdings. 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? Since EGLX is currently undervalued, it may be a great time to increase 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 financial health to consider, which could explain the current undervaluation.