Inchcape plc (LON:INCH), is not the largest company out there, but it saw significant share price movement during recent months on the LSE, rising to highs of UK£7.40 and falling to the lows of UK£6.47. 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 Inchcape's current trading price of UK£6.91 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 Inchcape’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Inchcape

What's the opportunity in Inchcape?

Good news, investors! Inchcape is still a bargain right now. According to my valuation, the intrinsic value for the stock is £10.10, but it is currently trading at UK£6.91 on the share market, meaning that there is still an opportunity to buy now. However, given that Inchcape’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.

Can we expect growth from Inchcape?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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 more than double over the next couple of years, the future seems bright for Inchcape. 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 INCH 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.

Are you a potential investor? If you’ve been keeping an eye on INCH 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 INCH. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.