Napco Security Technologies, Inc. (NASDAQ:NSSC), is not the largest company out there, but it saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$58.00 and falling to the lows of US$34.23. 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 Napco Security Technologies' current trading price of US$34.23 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 Napco Security Technologies's outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

Is Napco Security Technologies Still Cheap?

Great news for investors – Napco Security Technologies is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is $56.07, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Napco Security Technologies'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 another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

Can we expect growth from Napco Security Technologies?

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 51% over the next couple of years, the future seems bright for Napco Security Technologies. 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 NSSC is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic 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 undervaluation.

Are you a potential investor? If you've been keeping an eye on NSSC for a while, now might be the time to enter the stock. Its buoyant future outlook isn't fully reflected in the current share price yet, which means it's not too late to buy NSSC. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. Every company has risks, and we've spotted 1 warning sign for Napco Security Technologies you should know about.

If you are no longer interested in Napco Security Technologies, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.