Midland States Bancorp Inc (NASDAQ:MSBI), 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 $35.08 and falling to the lows of $25.73. 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 Midland States Bancorp’s current trading price of $27.4 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 Midland States Bancorp’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 Midland States Bancorp?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 19.96% above my intrinsic value, which means if you buy Midland States Bancorp today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth $22.84, then there isn’t really any room for the share price grow beyond what it’s currently trading. Furthermore, Midland States Bancorp’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. This may mean it is less likely for the stock to fall lower from natural market volatility, which suggests less opportunities to buy moving forward.
What does the future of Midland States Bancorp look like?
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. With profit expected to more than double over the next couple of years, the future seems bright for Midland States Bancorp. 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? MSBI’s optimistic future growth appears to have been factored into the current share price, 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 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 MSBI, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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 Midland States Bancorp. You can find everything you need to know about Midland States Bancorp in the latest infographic research report. If you are no longer interested in Midland States Bancorp, 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 firstname.lastname@example.org.