In fact, driven by the expectation of interest rate cuts, the Russell 2000 index, which represents the performance of the US small-cap stock market, has been rising all the way since April this year.

According to historical experience, the restart of the Federal Reserve's interest rate cut cycle is first beneficial to small-cap stocks. Benefiting from the low-interest-rate environment, small-cap companies can often directly improve their profitability with lower financing costs; and benefiting from the improvement of market liquidity and the increase in risk appetite, interest rate cuts are also expected to stimulate investors to lay out those small-cap stocks that have been ignored but have high-quality fundamentals at low prices.

Previously, US small-cap stocks had been depressed for a long time since 2022, and naturally, there is no shortage of companies in the current market whose profit expectations are good but whose valuations have not yet reflected their value.

In October this year, the US investment research institution Zacks covered NIVF (stock abbreviation "NIVF") for the first time and gave it a valuation of $15 per share. When the report was released, the stock price of NIVF was only $1.81.

So, what are the reasons for the gap between the institutional judgment and the market performance? Can NIVF support the target price of $15 per share?

01 Market Value Lower Than Cash Assets, Why Is NIVF Undervalued?

The current US stock market presents a significant pattern of "overvaluation of large-cap stocks and undervaluation of small-cap companies". On one side, the US stock "Magnificent Seven" such as Apple, Microsoft, and Alphabet are in the spotlight, with NVIDIA refreshing a human history record with a market value of $5 trillion; on the other side, a large number of small and medium-cap stocks face insufficient liquidity, and there are even individual stocks like NIVF whose market value is even lower than the company's cash assets.

At present, NIVF holds approximately $1.3082 million in bank cash, virtual currency SOL worth about $2.1137 million, and in addition, it has paid a deposit of around $3.6147 million for land purchase, with a total cash assets holding of about $7.0367 million.

However, as of November 3 local time, the market value of NIVF was only about $1.34 million, far lower than its cash on hand.

This indicates that this individual stock has been "accidentally harmed" by the overall environment of the US stock market to a certain extent.

Of course, the market's concerns are not unfounded. Since 2023, NIVF has been in a state of continuous losses, and considering its previous business structure dominated by medical services, most companies of the same type in the US stock market have also not yet achieved profitability.

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