Is Now The Time To Look At Buying Option Care Health, Inc. (NASDAQ:OPCH)?
Option Care Health, Inc. (NASDAQ:OPCH), is not the largest company out there, but it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$35.00 and falling to the lows of US$27.84. 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 Option Care Health's current trading price of US$30.12 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Option Care Health’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Option Care Health
Is Option Care Health Still Cheap?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 8.4% below my intrinsic value, which means if you buy Option Care Health today, you’d be paying a fair price for it. And if you believe that the stock is really worth $32.87, then there’s not much of an upside to gain from mispricing. So, is there another chance to buy low in the future? Given that Option Care Health’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.
What kind of growth will Option Care Health generate?
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. However, with a relatively muted profit growth of 9.9% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Option Care Health, at least in the short term.
What This Means For You
Are you a shareholder? It seems like the market has already priced in OPCH’s future outlook, 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?
Are you a potential investor? If you’ve been keeping an eye on OPCH, 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.
If you'd like to know more about Option Care Health as a business, it's important to be aware of any risks it's facing. In terms of investment risks, we've identified 1 warning sign with Option Care Health, and understanding this should be part of your investment process.
If you are no longer interested in Option Care Health, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
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