While Sphere Entertainment Co. (NYSE:SPHR) might not be the most widely known stock at the moment, it saw a significant share price rise of over 20% in the past couple of months on the NYSE. As a stock with high coverage by analysts, you could assume any recent changes in the company's outlook is already priced into the stock. But what if there is still an opportunity to buy? Today I will analyse the most recent data on Sphere Entertainment's outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Sphere Entertainment

What's The Opportunity In Sphere Entertainment?

According to my valuation model, Sphere Entertainment seems to be fairly priced at around 2.3% below my intrinsic value, which means if you buy Sphere Entertainment today, you'd be paying a fair price for it. And if you believe that the stock is really worth $42.25, then there isn't much room for the share price grow beyond what it's currently trading. So, is there another chance to buy low in the future? Given that Sphere Entertainment'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 an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Sphere Entertainment look like?

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. However, with an extremely negative double-digit change in profit expected over the next couple of years, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Sphere Entertainment, at least in the near future.

What This Means For You

Are you a shareholder? SPHR seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to reduce the risk in your portfolio. Is your current exposure to the stock beneficial for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.

Are you a potential investor? If you've been keeping an eye on SPHR for a while, now may not be the most advantageous time to buy, given it is trading around its fair value. The stock appears to be trading at fair value, which means there's less benefit from mispricing. In addition to this, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven't considered today, which can help gel your views on SPHR should the price fluctuate below its true value.

If you want to dive deeper into Sphere Entertainment, you'd also look into what risks it is currently facing. At Simply Wall St, we found 3 warning signs for Sphere Entertainment and we think they deserve your attention.

If you are no longer interested in Sphere Entertainment, 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.