Strive stock: recent performance snapshot

Strive (ASST) has drawn fresh attention after a volatile stretch, with the stock up about 63% over the past 3 months but down roughly 20% over the past month.

Over the past year, momentum for Strive has cooled. The strong 90 day share price return of 63.4% contrasts with a weaker year to date share price return of 16.6% and a recent pullback from US$14.43.

If you are comparing Strive with other opportunities in asset management and beyond, it can help to widen the lens and see how leadership driven businesses have been performing through the 19 top founder-led companies

With revenue growth, rapid net income swings and a share price that has surged over 90 days yet fallen year to date, the real question is whether Strive is still undervalued or if the market is already pricing in future growth.

Preferred price to book of 1.5x: Is it justified?

On a P/B of 1.5x, Strive trades below both the US Medical Equipment industry average of 2.4x and a peer group average of 1.9x, which points to a lower valuation relative to comparable stocks.

The P/B ratio compares the company’s market value to its book value. It is often used for asset heavy or early stage, loss making businesses where earnings are not yet a reliable guide. For Strive, which is still reporting losses and has a return on equity that is currently negative, P/B can give a clearer snapshot of how the market is pricing its net assets.

Given that Strive is forecast to grow revenue at 16.8% per year and is expected to move from losses into profit over the next three years, a P/B below both industry and peer averages suggests the market is not pricing the stock at a premium despite those forecasts. The valuation discount, if sustained, could narrow if revenue forecasts and the expected shift to profitability occur as anticipated by analysts or if sentiment toward the Medical Equipment sector improves.

Compared with the wider US Medical Equipment industry P/B of 2.4x and a peer group at 1.9x, Strive’s 1.5x stands at a clear discount on both measures, indicating that similar businesses are currently valued more highly on their net asset base.

Result: Price-to-book of 1.5x (UNDERVALUED).

However, there are clear risks. These include ongoing losses of US$697.96 million and a market value of about US$1.04b that already reflects meaningful expectations.

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Next Steps

With the mixed picture of rapid share price swings, ongoing losses and forecasts for improvement, the sentiment around Strive is clearly divided. If that balance of concerns and potential rewards matters to your decision, take a closer look at the data and stress test your own thesis against the 2 key rewards and 1 important warning sign.

Looking for more investment ideas?

If Strive is on your radar, do not stop there. Broaden your watchlist with stocks that match different goals, from value to resilience and income.

• Target potential value opportunities by scanning the 47 high quality undervalued stocks that combine quality fundamentals with pricing that may not fully reflect them.
• Build a sturdier core for your portfolio by reviewing the solid balance sheet and fundamentals stocks screener (46 results) focused on companies with stronger financial footing.
• Strengthen your income stream by checking out the 9 dividend fortresses that offer higher yields while still passing key quality checks.

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.