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Is It Too Late To Consider Buying Diplomat Pharmacy, Inc. (NYSE:DPLO)?

Simply Wall St

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Diplomat Pharmacy, Inc. (NYSE:DPLO), which is in the healthcare business, and is based in United States, received a lot of attention from a substantial price increase on the NYSE over the last few months. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at Diplomat Pharmacy’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for Diplomat Pharmacy

What is Diplomat Pharmacy worth?

Good news, investors! Diplomat Pharmacy is still a bargain right now. According to my valuation, the intrinsic value for the stock is $8.74, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Diplomat Pharmacy’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 Diplomat Pharmacy look like?

NYSE:DPLO Past and Future Earnings, June 26th 2019

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. With profit expected to grow by 95% over the next couple of years, the future seems bright for Diplomat Pharmacy. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? Since DPLO is currently undervalued, it may be a great time to increase 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 capital structure to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on DPLO for a while, now might be the time to make a leap. Its buoyant future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy DPLO. 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 buy.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Diplomat Pharmacy. You can find everything you need to know about Diplomat Pharmacy in the latest infographic research report. If you are no longer interested in Diplomat Pharmacy, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.