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Why monday.com Ltd. (NASDAQ:MNDY) Could Be Worth Watching

monday.com Ltd. (NASDAQ:MNDY), 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$236 and falling to the lows of US$184. 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 monday.com's current trading price of US$185 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 monday.com’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 monday.com

What's The Opportunity In monday.com?

Great news for investors – monday.com is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $275.66, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because monday.com’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What does the future of monday.com look like?

earnings-and-revenue-growth
earnings-and-revenue-growth

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. However, with a negative profit growth of -4.7% expected over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for monday.com. This certainty tips the risk-return scale towards higher risk.

What This Means For You

Are you a shareholder? Although MNDY is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. We recommend you think about whether you want to increase your portfolio exposure to MNDY, or whether diversifying into another stock may be a better move for your total risk and return.

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Are you a potential investor? If you’ve been keeping tabs on MNDY for some time, but hesitant on making the leap, we recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

If you'd like to know more about monday.com as a business, it's important to be aware of any risks it's facing. For example - monday.com has 1 warning sign we think you should be aware of.

If you are no longer interested in monday.com, 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.