MidWestOne Financial Group Inc (NASDAQ:MOFG), operating in the financial services industry based in United States, saw significant share price volatility over the past couple of months on the NasdaqGS, rising to the highs of $34.73 and falling to the lows of $28.3. 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 MidWestOne Financial Group’s current trading price of $29.16 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 MidWestOne Financial Group’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
What’s the opportunity in MidWestOne Financial Group?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 8.49% above my intrinsic value, which means if you buy MidWestOne Financial Group today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is $26.88, then there isn’t really any room for the share price grow beyond what it’s currently trading. In addition to this, it seems like MidWestOne Financial Group’s share price is quite stable, which could mean 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 MidWestOne Financial Group?
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. MidWestOne Financial Group’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? It seems like the market has already priced in MOFG’s positive outlook, 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 MOFG, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining 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 MidWestOne Financial Group. You can find everything you need to know about MidWestOne Financial Group in the latest infographic research report. If you are no longer interested in MidWestOne Financial 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 past 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. For errors that warrant correction please contact the editor at email@example.com.