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What Is Advanced Emissions Solutions, Inc.'s (NASDAQ:ADES) Share Price Doing?

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Advanced Emissions Solutions, Inc. (NASDAQ:ADES), which is in the chemicals business, and is based in United States, saw significant share price movement during recent months on the NASDAQGM, rising to highs of US$14.84 and falling to the lows of US$9.87. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Advanced Emissions Solutions's current trading price of US$10.46 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Advanced Emissions Solutions’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Advanced Emissions Solutions

Is Advanced Emissions Solutions still cheap?

Good news, investors! Advanced Emissions Solutions is still a bargain right now. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Advanced Emissions Solutions’s ratio of 5.79x is below its peer average of 20.45x, which suggests the stock is undervalued compared to the Chemicals industry. Although, there may be another chance to buy again in the future. This is because Advanced Emissions Solutions’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What kind of growth will Advanced Emissions Solutions generate?

NasdaqGM:ADES Past and Future Earnings, December 12th 2019
NasdaqGM:ADES Past and Future Earnings, December 12th 2019

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. Advanced Emissions Solutions’s earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since ADES is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. 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 ADES for a while, now might be the time to enter the stock. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy ADES. 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 buy.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Advanced Emissions Solutions. You can find everything you need to know about Advanced Emissions Solutions in the latest infographic research report. If you are no longer interested in Advanced Emissions Solutions, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.