Anworth Mortgage Asset Corporation (NYSE:ANH), a mortgage reits company based in United States, had a relatively subdued couple of weeks in terms of changes in share price, which continued to float around the range of $4.56 to $4.96. However, is this the true valuation level of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Anworth Mortgage Asset’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change. Check out our latest analysis for Anworth Mortgage Asset
What’s the opportunity in Anworth Mortgage Asset?
According to my valuation model, Anworth Mortgage Asset seems to be fairly priced at around 12.44% below my intrinsic value, which means if you buy Anworth Mortgage Asset today, you’d be paying a fair price for it. And if you believe the company’s true value is $5.47, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, it seems like Anworth Mortgage Asset’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s fairly valued. This is because the stock is less volatile than the wider market given its low beta.
Can we expect growth from Anworth Mortgage Asset?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. However, with a relatively muted revenue growth of 2.98% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Anworth Mortgage Asset, at least in the short term.
What this means for you:
Are you a shareholder? ANH’s 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 confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you’ve been keeping an eye on ANH, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Anworth Mortgage Asset. You can find everything you need to know about Anworth Mortgage Asset in the latest infographic research report. If you are no longer interested in Anworth Mortgage Asset, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.