While Glatfelter Corporation (NYSE:GLT) might not be the most widely known stock at the moment, it saw a significant share price rise of over 20% in the past couple of months on the NYSE. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s take a look at Glatfelter’s outlook and value based on the most recent financial data to see if the opportunity still exists.
See our latest analysis for Glatfelter
What Is Glatfelter Worth?
According to my valuation model, Glatfelter seems to be fairly priced at around 14% below my intrinsic value, which means if you buy Glatfelter today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $3.34, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since Glatfelter’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. 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.
What kind of growth will Glatfelter generate?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. Though in the case of Glatfelter, it is expected to deliver a relatively unexciting top-line growth of 8.1% over the next year, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What This Means For You
Are you a shareholder? It seems like the market has already priced in GLT’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 financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you’ve been keeping tabs on GLT, now may not be the most advantageous 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.