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Exponent, Inc. (NASDAQ:EXPO), might not be a large cap stock, but it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$93.95 and falling to the lows of US$78.52. 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 Exponent's current trading price of US$78.52 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Exponent’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Is Exponent Still Cheap?
According to our valuation model, Exponent seems to be fairly priced at around 9.3% below our intrinsic value, which means if you buy Exponent today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $86.57, then there isn’t much room for the share price grow beyond what it’s currently trading. What's more, Exponent’s share price may be more stable over time (relative to the market), as indicated by its low beta.
Check out our latest analysis for Exponent
Can we expect growth from Exponent?
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. However, with a relatively muted profit growth of 1.8% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Exponent, at least in the short term.
What This Means For You
Are you a shareholder? It seems like the market has already priced in EXPO’s future outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. 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?
Are you a potential investor? If you’ve been keeping tabs on EXPO, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.