Energiekontor AG (ETR:EKT), might not be a large cap stock, but it saw significant share price movement during recent months on the XTRA, rising to highs of €82.00 and falling to the lows of €63.90. 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 Energiekontor's current trading price of €64.00 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 Energiekontor’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 Energiekontor

Is Energiekontor Still Cheap?

Good news, investors! Energiekontor is still a bargain right now according to our price multiple model, which compares the company's price-to-earnings ratio to the industry average. In this instance, we’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. we find that Energiekontor’s ratio of 10.66x is below its peer average of 21.05x, which indicates the stock is trading at a lower price compared to the Electrical industry. Another thing to keep in mind is that Energiekontor’s share price is quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its industry peers, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.

Can we expect growth from Energiekontor?

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. Though in the case of Energiekontor, it is expected to deliver a negative earnings growth of -9.6%, 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? Although EKT is currently trading below the industry PE ratio, the adverse prospect of negative growth brings about some degree of risk. Consider whether you want to increase your portfolio exposure to EKT, or whether diversifying into another stock may be a better move for your total risk and return.