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Revolution Beauty Group plc (LON:REVB), is not the largest company out there, but it saw a significant share price rise of 25% in the past couple of months on the AIM. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s examine Revolution Beauty Group’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
Is Revolution Beauty Group Still Cheap?
The stock seems fairly valued at the moment according to our valuation model. It’s trading around 8.6% below our intrinsic value, which means if you buy Revolution Beauty Group today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth £0.14, 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 Revolution Beauty Group’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, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
See our latest analysis for Revolution Beauty Group
Can we expect growth from Revolution Beauty Group?
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. 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. However, with an extremely negative double-digit change in profit expected next year, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Revolution Beauty Group, at least in the near future.
What This Means For You
Are you a shareholder? REVB seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to reduce the risk in your portfolio. Is your current exposure to the stock optimal for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.