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While NV5 Global, Inc. (NASDAQ:NVEE) might not have the largest market cap around , it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$113 and falling to the lows of US$89.46. 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 NV5 Global's current trading price of US$90.04 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 NV5 Global’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 NV5 Global
Is NV5 Global Still Cheap?
According to our price multiple model, where we compare the company's price-to-earnings ratio to the industry average, the stock currently looks expensive. We’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 32.12x is currently well-above the industry average of 26.19x, meaning that it is trading at a more expensive price relative to its peers. But, is there another opportunity to buy low in the future? Given that NV5 Global’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.
What does the future of NV5 Global look like?
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. With profit expected to grow by 28% over the next couple of years, the future seems bright for NV5 Global. 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 well and truly priced in NVEE’s positive outlook, with shares trading above industry price multiples. However, this brings up another question – is now the right time to sell? If you believe NVEE should trade below its current price, selling high and buying it back up again when its price falls towards the industry PE ratio can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.