Endava plcNYSE:DAVAAlthough it might not be the most well-known stock, it has received a lot attention due to a significant price rise on the NYSE in the past few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. The stock could still be selling at a low price. Today I will analyse the most recent data on Endava’s outlook and valuation to see if the opportunity still exists.
Endava: What’s the Opportunity?
According to my valuation model the stock is currently priced at US$77.58 and trading at US$77.58. This compares to my intrinsic value which is $59.80. The buy opportunity has likely disappeared at this time. If you are a fan of the stock, it is worth keeping an eye on a possible price decline in future. Given that Endava’s share is fairly volatile (i.e. Endava’s share is quite volatile (i.e., its price movements are magnified relative the rest of the stock market), this could mean that the price can sink further, giving us another opportunity to buy in future. This is due to its high beta which is an indicator of share price volatility.
Endava: Can we expect growth?
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. Endava’s earnings should increase by 21% over the next year. This indicates a very optimistic future. This should result in stronger cash flows that will feed into higher share values.
This is What It Means for You
Are you a shareholder? DAVA’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? It is possible to make a profit by selling high and then buying back the shares when it falls to its true value. However, before you make any decision, be sure to examine the fundamentals.
Are you a potential investor? If you’ve been keeping tabs on DAVA for some time, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the optimistic prospect is encouraging for DAVA, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
It’s important to be aware of any potential risks if you are interested in investing more in this stock. Endava was found to have a number of risks during our analysis. 1 warning sign This is something you should not ignore.
You can also use our platform to view our entire list of over-priced Endava products if you’re not interested anymore. 50 other stocks with a high growth potential.
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This article by Simply Wall St has a general nature. Our commentary is based on historical data, analyst forecasts and other unbiased information. We do not intend to provide financial advice. This does not constitute a recommendation for you to buy or sell any stock. It also does not consider your financial goals or financial situation. We strive to deliver long-term, well-rounded analysis that is based on fundamental data. Please note that our analysis might not include the most recent announcements from price-sensitive companies or qualitative material. Simply Wall St holds no position in any of the stocks mentioned.
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