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Is It The Right Time To Buy Pretium Resources Inc (TSE:PVG)?

Pretium Resources Inc (TSX:PVG), a metals and mining company based in Canada, saw significant share price volatility over the past couple of months on the TSX, rising to the highs of CA$14.46 and falling to the lows of CA$7.94. 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 Pretium Resources’s current trading price of CA$8.6 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 Pretium Resources’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 Pretium Resources

Is Pretium Resources still cheap?

Good news, investors! Pretium Resources is still a bargain right now. According to my valuation, the intrinsic value for the stock is CA$12.31, but it is currently trading at CA$8.60 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Pretium Resources’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, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What kind of growth will Pretium Resources generate?

TSX:PVG Future Profit Apr 10th 18
TSX:PVG Future Profit Apr 10th 18

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. In Pretium Resources’s case, its revenues over the next couple of years are expected to double, indicating an incredibly optimistic future ahead. If expense does not increase by the same rate, or higher, this top line growth should lead to stronger cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since PVG is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With a positive outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on PVG for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy PVG. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Pretium Resources. You can find everything you need to know about Pretium Resources in the latest infographic research report. If you are no longer interested in Pretium Resources, 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.

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