Lekoil Limited (AIM:LEK), an energy company based in Nigeria, saw a decent share price growth in the teens level on the AIM over the last few months. Less covered, small-stocks like LEK sees more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing. So, could LEK still be trading at a low price relative to its actual value? Let’s take a look at LEK’s outlook and value based on the most recent financial data to see if the opportunity still exists. Check out our latest analysis for Lekoil

Is LEK still cheap?

Great news for investors – LEK is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is £1.05, but it is currently trading at £0.18 on the share market, meaning that there is still an opportunity to buy now. LEK’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

What kind of growth will LEK generate?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at LEK future expectations. With revenue expected to more than double in the next few years, the future appears to be extremely bright for LEK. If expenses can also be maintained, it looks like higher cash flows 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 LEK is currently undervalued, 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 undervaluation.

Are you a potential investor? If you’ve been keeping an eye on LEK for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy LEK. 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.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Lekoil. You can find everything you need to know about LEK in the latest infographic research report. If you are no longer interested in Lekoil, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.