Fastly, Inc. (NYSE:FSLY), might not be a large cap stock, but it saw a significant share price rise of 33% in the past couple of months on the NYSE. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock's share price. However, could the stock still be trading at a relatively cheap price? Let's examine Fastly's valuation and outlook in more detail to determine if there's still a bargain opportunity.

Check out our latest analysis for Fastly

Is Fastly Still Cheap?

Great news for investors – Fastly is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $30.85, but it is currently trading at US$18.76 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 Fastly'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 Fastly 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 20% over the next couple of years, the future seems bright for Fastly. It looks like higher cash flow 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 FSLY is currently undervalued, it may be a great time to increase 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 FSLY for a while, now might be the time to make a leap. Its prosperous future outlook isn't fully reflected in the current share price yet, which means it's not too late to buy FSLY. 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.

So while earnings quality is important, it's equally important to consider the risks facing Fastly at this point in time. For example, we've discovered 3 warning signs that you should run your eye over to get a better picture of Fastly.

If you are no longer interested in Fastly, 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.