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What Is Tremor International Ltd's (LON:TRMR) Share Price Doing?

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·3-min read
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Tremor International Ltd (LON:TRMR), might not be a large cap stock, but it saw a decent share price growth in the teens level on the AIM over the last few months. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s take a look at Tremor International’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Tremor International

What's the opportunity in Tremor International?

Great news for investors – Tremor International is still trading at a fairly cheap price according to my price multiple model, where I compare the company's price-to-earnings ratio to the industry average. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 12.36x is currently well-below the industry average of 25.64x, meaning that it is trading at a cheaper price relative to its peers. What’s more interesting is that, Tremor International’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from Tremor International?

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. 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 the company's future expectations. Though in the case of Tremor International, it is expected to deliver a relatively unexciting earnings growth of 0.4%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for Tremor International, at least in the near term.

What this means for you:

Are you a shareholder? Even though growth is relatively muted, since TRMR is currently trading below the industry PE ratio, it may be a great time to increase your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current price multiple.

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

With this in mind, we wouldn't consider investing in a stock unless we had a thorough understanding of the risks. For example - Tremor International has 3 warning signs we think you should be aware of.

If you are no longer interested in Tremor International, 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.

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