Porvair plc (LON:PRV), is not the largest company out there, but it received a lot of attention from a substantial price movement on the LSE over the last few months, increasing to UK£6.84 at one point, and dropping to the lows of UK£5.60. 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 Porvair's current trading price of UK£5.81 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 Porvair’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 Porvair

What is Porvair worth?

According to my valuation model, Porvair seems to be fairly priced at around 19.30% above my intrinsic value, which means if you buy Porvair today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth £4.87, there’s only an insignificant downside when the price falls to its real value. In addition to this, Porvair has a low beta, which suggests its share price is less volatile than the wider market.

What kind of growth will Porvair 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. With profit expected to grow by a double-digit 16% over the next couple of years, the outlook is positive for Porvair. 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? It seems like the market has already priced in PRV’s positive 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 confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on PRV, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.