At US$41.29, Is Nanometrics Incorporated (NASDAQ:NANO) A Buy?
Nanometrics Incorporated (NASDAQ:NANO), a semiconductor company based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NasdaqGS. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s take a look at Nanometrics’s outlook and value based on the most recent financial data to see if the opportunity still exists.
See our latest analysis for Nanometrics
What’s the opportunity in Nanometrics?
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 3.31% below my intrinsic value, which means if you buy Nanometrics today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth $42.7, then there’s not much of an upside to gain from mispricing. So, is there another chance to buy low in the future? Given that Nanometrics’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.
Can we expect growth from Nanometrics?
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 a double-digit 16.69% in the upcoming year, the short-term outlook is positive for Nanometrics. 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? It seems like the market has already priced in NANO’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 financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you’ve been keeping tabs on NANO, 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 Nanometrics. You can find everything you need to know about Nanometrics in the latest infographic research report. If you are no longer interested in Nanometrics, 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 editorial-team@simplywallst.com.
