In This Article:
kneat.com, inc. (TSE:KSI), is not the largest company out there, but it saw a significant share price rise of 30% in the past couple of months on the TSX. The recent jump in the share price has meant that the company is trading at close to its 52-week high. As a stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Today we will analyse the most recent data on kneat.com’s outlook and valuation to see if the opportunity still exists.
View our latest analysis for kneat.com
What Is kneat.com Worth?
kneat.com appears to be overvalued by 22% at the moment, based on our discounted cash flow valuation. The stock is currently priced at CA$5.88 on the market compared to our intrinsic value of CA$4.83. This means that the opportunity to buy kneat.com at a good price has disappeared! But, is there another opportunity to buy low in the future? Given that kneat.com’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 kneat.com?
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 77% over the next couple of years, the future seems bright for kneat.com. 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 KSI’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe KSI 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.
Are you a potential investor? If you’ve been keeping an eye on KSI for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for KSI, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.