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LPKF Laser & Electronics SE (ETR:LPK), might not be a large cap stock, but it saw significant share price movement during recent months on the XTRA, rising to highs of €9.81 and falling to the lows of €8.02. 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 LPKF Laser & Electronics' current trading price of €8.61 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at LPKF Laser & Electronics’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 LPKF Laser & Electronics
What's The Opportunity In LPKF Laser & Electronics?
The stock is currently trading at €8.61 on the share market, which means it is overvalued by 29% compared to our intrinsic value of €6.67. This means that the opportunity to buy LPKF Laser & Electronics at a good price has disappeared! But, is there another opportunity to buy low in the future? Given that LPKF Laser & Electronics’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 LPKF Laser & Electronics?
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. In LPKF Laser & Electronics' case, its revenues over the next few years are expected to grow by 39%, indicating a highly optimistic future ahead. If expense does not increase by the same rate, or higher, this top line growth should lead to stronger cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? It seems like the market has well and truly priced in LPK’s positive outlook, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? If you believe LPK should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.