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Team17 Group plc (LON:TM17), is not the largest company out there, but it led the AIM gainers with a relatively large price hike in the past couple of weeks. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Team17 Group’s outlook and valuation to see if the opportunity still exists.
Check out our latest analysis for Team17 Group
What Is Team17 Group Worth?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 0.22% above my intrinsic value, which means if you buy Team17 Group today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth £4.73, there’s only an insignificant downside when the price falls to its real value. What's more, Team17 Group’s share price may be more stable over time (relative to the market), as indicated by its low beta.
What kind of growth will Team17 Group 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. With profit expected to grow by 61% over the next couple of years, the future seems bright for Team17 Group. 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? TM17’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 conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping tabs on TM17, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook 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.
Diving deeper into the forecasts for Team17 Group mentioned earlier will help you understand how analysts view the stock going forward. So feel free to check out our free graph representing analyst forecasts.