Yahoo Finance Should You Buy Syntel Inc (SYNT)?
Syntel Inc (NASDAQ:SYNT), a software and services company based in United States, saw a decent share price growth in the teens level on the NasdaqGS over the last few months. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today I will analyse the most recent data on SYNT’s outlook and valuation to see if the opportunity still exists. View our latest analysis for Syntel
What's the opportunity in SYNT?
Great news for investors – SYNT is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $30.33 which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because SYNT’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, SYNT’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
What kind of growth will SYNT generate?
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. Though in the case of SYNT, it is expected to deliver a negative revenue growth of -3.29% over the next couple of years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? Although SYNT is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to SYNT, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping an eye on SYNT for a while, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Syntel. You can find everything you need to know about SYNT in the latest infographic research report. If you are no longer interested in Syntel, 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.
