Yahoo Finance Should You Think About Buying Tristel Plc (LON:TSTL) Now?
Tristel Plc (LON:TSTL), which is in the medical equipment business, and is based in United Kingdom, saw a double-digit share price rise of over 10% in the past couple of months on the AIM. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Today I will analyse the most recent data on Tristel’s outlook and valuation to see if the opportunity still exists.
See our latest analysis for Tristel
What is Tristel worth?
According to my valuation model, Tristel seems to be fairly priced at around 7.57% above my intrinsic value, which means if you buy Tristel today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth £2.73, then there isn’t really any room for the share price grow beyond what it’s currently trading. In addition to this, Tristel has a low beta, which suggests its share price is less volatile than the wider market.
What does the future of Tristel look like?
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. In the upcoming year, Tristel’s earnings are expected to increase by 28%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
What this means for you:
Are you a shareholder? TSTL’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 track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you’ve been keeping an eye on TSTL, 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 diving deeper into 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 Tristel. You can find everything you need to know about Tristel in the latest infographic research report. If you are no longer interested in Tristel, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
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.
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. Thank you for reading.
