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Iress Limited (ASX:IRE), might not be a large cap stock, but it saw significant share price movement during recent months on the ASX, rising to highs of AU$9.67 and falling to the lows of AU$8.67. 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 Iress' current trading price of AU$8.98 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 Iress’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 Iress
What's The Opportunity In Iress?
Good news, investors! Iress is still a bargain right now. According to our valuation, the intrinsic value for the stock is A$14.20, but it is currently trading at AU$8.98 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Iress’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
What kind of growth will Iress generate?
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. 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. Iress' earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.
What This Means For You
Are you a shareholder? Since IRE is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on IRE for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy IRE. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.