While Pushpay Holdings Limited (NZSE:PPH) might not be the most widely known stock at the moment, it saw a double-digit share price rise of over 10% in the past couple of months on the NZSE. 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. However, could the stock still be trading at a relatively cheap price? Let’s examine Pushpay Holdings’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.

View our latest analysis for Pushpay Holdings

Is Pushpay Holdings still cheap?

According to my valuation model, Pushpay Holdings seems to be fairly priced at around 8.5% below my intrinsic value, which means if you buy Pushpay Holdings today, you’d be paying a reasonable price for it. And if you believe the company’s true value is NZ$1.98, then there isn’t much room for the share price grow beyond what it’s currently trading. In addition to this, Pushpay Holdings has a low beta, which suggests its share price is less volatile than the wider market.

What does the future of Pushpay Holdings 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. 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 92% over the next couple of years, the future seems bright for Pushpay Holdings. 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? PPH’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 PPH, 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.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. You'd be interested to know, that we found 2 warning signs for Pushpay Holdings and you'll want to know about them.

If you are no longer interested in Pushpay Holdings, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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