The Hackett Group, Inc. (NASDAQ:HCKT), might not be a large cap stock, but it led the NASDAQGS gainers with a relatively large price hike in the past couple of weeks. The company is inching closer to its yearly highs following the recent share price climb. Less-covered, small caps tend to present more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could the stock still be trading at a low price relative to its actual value? Let's examine Hackett Group's valuation and outlook in more detail to determine if there's still a bargain opportunity.
View our latest analysis for Hackett Group
Great news for investors - Hackett Group is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $41.78, but it is currently trading at US$25.69 on the share market, meaning that there is still an opportunity to buy now. What's more interesting is that, Hackett Group's share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
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. However, with a relatively muted profit growth of 8.5% expected over the next year, growth doesn't seem like a key driver for a buy decision for Hackett Group, at least in the short term.
Are you a shareholder? Even though growth is relatively muted, since HCKT is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor? If you've been keeping an eye on HCKT for a while, now might be the time to enter the stock. Its future outlook isn't fully reflected in the current share price yet, which means it's not too late to buy HCKT. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.
It can be quite valuable to consider what analysts expect for Hackett Group from their most recent forecasts. At Simply Wall St, we have the analysts estimates which you can view by clicking here.
If you are no longer interested in Hackett Group, you can use our free platform to see our list of over 50 other stocks with a high growth potential.