Have Investors Already Priced In Gee Group Inc’s (JOB) Growth?
Gee Group Inc (AMEX:JOB), a commercial and professional services company based in United States, saw significant share price volatility over the past couple of months on the AMEX, rising to the highs of $5.6 and falling to the lows of $3.99. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether JOB's current trading price of $3.99 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 JOB’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 Gee Group
What is JOB worth?
Great news for investors – JOB is still trading at a fairly cheap price. I’ve used the price-to-book ratio in this instance because there’s not enough visibility to forecast its cash flows, and its earnings doesn’t seem to reflect its true value. The stock’s ratio of 2x is currently well-below the industry average of 10.4x, meaning that it is trading at a cheaper price relative to its peers. JOB’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.
What does the future of JOB look like?
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 JOB future expectations. Though in the case of JOB, it is expected to deliver a negative earnings growth of -9.70%, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? Although JOB is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. Consider whether you want to increase your portfolio exposure to JOB, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor? If you’ve been keeping an eye on JOB for a while, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Gee Group. You can find everything you need to know about JOB in the latest infographic research report. If you are no longer interested in Gee Group, 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.
