NexPoint Residential Trust Inc (NYSE:NXRT), a reits company based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. 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 take a look at NexPoint Residential Trust’s outlook and value based on the most recent financial data to see if the opportunity still exists. See our latest analysis for NexPoint Residential Trust

What is NexPoint Residential Trust worth?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 18.40% below my intrinsic value, which means if you buy NexPoint Residential Trust today, you’d be paying a fair price for it. And if you believe the company’s true value is $32.93, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, it seems like NexPoint Residential Trust’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s fairly valued. This is because the stock is less volatile than the wider market given its low beta.

Can we expect growth from NexPoint Residential Trust?

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. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for NexPoint Residential Trust, at least in the near future.

What this means for you:

Are you a shareholder? Currently, NXRT appears to be trading around its fair value, but given the uncertainty from negative returns in the future, this could be the right time to de-risk your portfolio. Is your current exposure to the stock beneficial 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.

Are you a potential investor? If you’ve been keeping an eye on NXRT for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. In addition to this, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help crystalize your views on NXRT should the price fluctuate below its true value.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on NexPoint Residential Trust. You can find everything you need to know about NexPoint Residential Trust in the latest infographic research report. If you are no longer interested in NexPoint Residential Trust, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.