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Is Now The Time To Look At Buying Pushpay Holdings Limited (NZSE:PPH)?

Pushpay Holdings Limited (NZSE:PPH), is not the largest company out there, but it saw a double-digit share price rise of over 10% in the past couple of months on the NZSE. 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 Pushpay Holdings’s outlook and valuation to see if the opportunity still exists.

View our latest analysis for Pushpay Holdings

What's the opportunity in Pushpay Holdings?

According to my valuation model, Pushpay Holdings seems to be fairly priced at around 19.69% above my intrinsic value, which means if you buy Pushpay Holdings today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is NZ$1.51, there’s only an insignificant downside when the price falls to its real value. So, is there another chance to buy low in the future? Given that Pushpay Holdings’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

Can we expect growth from Pushpay Holdings?

earnings-and-revenue-growth
earnings-and-revenue-growth

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. With profit expected to more than double 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 financial strength of the company. 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?

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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 positive outlook 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.

So while earnings quality is important, it's equally important to consider the risks facing Pushpay Holdings at this point in time. You'd be interested to know, that we found 2 warning signs for Pushpay Holdings and you'll want to know about these.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.