Eneraqua Technologies plc (LON:ETP), is not the largest company out there, but it received a lot of attention from a substantial price movement on the AIM over the last few months, increasing to UK￡0.44 at one point, and dropping to the lows of UK￡0.38. 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 Eneraqua Technologies' current trading price of UK￡0.39 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 Eneraqua Technologies’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Eneraqua Technologies

What's The Opportunity In Eneraqua Technologies?

Good news, investors! Eneraqua Technologies 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 Eneraqua Technologies’s ratio of 2.02x is below its peer average of 14.2x, which indicates the stock is trading at a lower price compared to the Building industry. What’s more interesting is that, Eneraqua Technologies’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to move closer to its industry peers, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will Eneraqua Technologies generate?

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 revenues expected to grow by 57% over the next couple of years, the future seems bright for Eneraqua Technologies. If the level of expenses is able to be maintained, 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 ETP is currently trading below the industry PE ratio, it may be a great time to accumulate more of 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 financial health to consider, which could explain the current price multiple.