While Frontier Digital Ventures Limited (ASX:FDV) might not have the largest market cap around , it received a lot of attention from a substantial price movement on the ASX over the last few months, increasing to AU$0.52 at one point, and dropping to the lows of AU$0.23. 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 Frontier Digital Ventures' current trading price of AU$0.24 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 Frontier Digital Ventures’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 Frontier Digital Ventures

What's The Opportunity In Frontier Digital Ventures?

According to our valuation model, the stock is currently overvalued by about 33%, trading at AU$0.24 compared to our intrinsic value of A$0.18. This means that the opportunity to buy Frontier Digital Ventures at a good price has disappeared! But, is there another opportunity to buy low in the future? Given that Frontier Digital Ventures’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 Frontier Digital Ventures?

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 Frontier Digital Ventures, it is expected to deliver a highly negative earnings growth in the upcoming, 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? If you believe FDV is currently trading above its value, selling high and buying it back up again when its price falls towards its real value can be profitable. Given the uncertainty from negative growth in the future, this could be the right time to de-risk your portfolio. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on FDV for a while, now may not be the best time to enter into the stock. The company’s price has climbed passed its true value, in addition to a risky future outlook. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Should the price fall in the future, will you be well-informed enough to buy?

If you'd like to know more about Frontier Digital Ventures as a business, it's important to be aware of any risks it's facing. In terms of investment risks, we've identified 1 warning sign with Frontier Digital Ventures, and understanding it should be part of your investment process.

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

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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.