Diffusion Pharmaceuticals Inc (NASDAQ:DFFN), a pharmaceuticals, biotechnology and life sciences company based in United States, Check out our latest analysis for Diffusion Pharmaceuticals
Is DFFN still cheap?
Great news for investors – DFFN is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $3.22 which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because DFFN’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, DFFN’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Can we expect growth from DFFN?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares.Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for DFFN, at least in the near future.
What this means for you:
Are you a shareholder? Although DFFN is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. I recommend you think about whether you want to increase your portfolio exposure to DFFN, 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 tabs on DFFN for some time, 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 Diffusion Pharmaceuticals. You can find everything you need to know about DFFN in the latest infographic research report. If you are no longer interested in Diffusion Pharmaceuticals, 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.