What Is Verint Systems Inc.'s (NASDAQ:VRNT) Share Price Doing?
Verint Systems Inc. (NASDAQ:VRNT), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to US$77.44 at one point, and dropping to the lows of US$44.56. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Verint Systems' current trading price of US$48.12 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Verint Systems’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for Verint Systems
Is Verint Systems still cheap?
According to my valuation model, Verint Systems seems to be fairly priced at around 9.19% above my intrinsic value, which means if you buy Verint Systems today, you’d be paying a relatively reasonable price for it. And if you believe that the stock is really worth $44.07, then there isn’t really any room for the share price grow beyond what it’s currently trading. Furthermore, Verint Systems’s low beta implies that the stock is less volatile than the wider market.
What kind of growth will Verint Systems generate?
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. Though in the case of Verint Systems, it is expected to deliver a highly negative revenue growth over the next few years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
What this means for you:
Are you a shareholder? Currently, VRNT appears to be trading around its fair value, but given the uncertainty from negative returns in the future, this could be the right time to reduce the risk in your portfolio. Is your current exposure to the stock beneficial for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping tabs on VRNT for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. Furthermore, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help gel your views on VRNT should the price fluctuate below its true value.
If you'd like to know more about Verint Systems as a business, it's important to be aware of any risks it's facing. For example, we've found that Verint Systems has 4 warning signs (1 makes us a bit uncomfortable!) that deserve your attention before going any further with your analysis.
If you are no longer interested in Verint Systems, you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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