Industrial Alliance Insurance and Financial Services Inc (TSX:IAG), a insurance company based in Canada, received a lot of attention from a substantial price movement on the TSX over the last few months, increasing to CA$61.69 at one point, and dropping to the lows of CA$51.38. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Industrial Alliance Insurance and Financial Services’s current trading price of CA$52.12 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 Industrial Alliance Insurance and Financial Services’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 Industrial Alliance Insurance and Financial Services

What’s the opportunity in Industrial Alliance Insurance and Financial Services?

Great news for investors – Industrial Alliance Insurance and Financial Services is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is CA$68.74, but it is currently trading at CA$52.12 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Industrial Alliance Insurance and Financial Services’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 Industrial Alliance Insurance and Financial Services look like?

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. 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 31.96% over the next couple of years, the future seems bright for Industrial Alliance Insurance and Financial Services. 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 IAG 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 IAG 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 IAG. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Industrial Alliance Insurance and Financial Services. You can find everything you need to know about Industrial Alliance Insurance and Financial Services in the latest infographic research report. If you are no longer interested in Industrial Alliance Insurance and Financial Services, 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.