Yahoo Finance When Should You Buy Numis Corporation Plc (LON:NUM)?
Numis Corporation Plc (LON:NUM), which is in the capital markets business, and is based in United Kingdom, saw a significant share price rise of over 20% in the past couple of months on the AIM. Less-covered, small caps tend to present more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Let’s take a look at Numis’s outlook and value based on the most recent financial data to see if the opportunity still exists.
See our latest analysis for Numis
What's the opportunity in Numis?
According to my valuation model, Numis seems to be fairly priced at around 9.1% below my intrinsic value, which means if you buy Numis today, you’d be paying a reasonable price for it. And if you believe the company’s true value is £3.25, then there isn’t much room for the share price grow beyond what it’s currently trading. In addition to this, Numis has a low beta, which suggests its share price is less volatile than the wider market.
What does the future of Numis 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 83% over the next year, the near-term future seems bright for Numis. 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? NUM’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping an eye on NUM, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect 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.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Numis. You can find everything you need to know about Numis in the latest infographic research report. If you are no longer interested in Numis, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
