Is Now An Opportune Moment To Examine WiseTech Global Limited (ASX:WTC)?

WiseTech Global Limited (ASX:WTC), might not be a large cap stock, but it saw significant share price movement during recent months on the ASX, rising to highs of AU$53.21 and falling to the lows of AU$36.64. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether WiseTech Global's current trading price of AU$36.64 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at WiseTech Global’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for WiseTech Global

What's the opportunity in WiseTech Global?

According to my valuation model, the stock is currently overvalued by about 31%, trading at AU$36.64 compared to my intrinsic value of A$27.97. Not the best news for investors looking to buy! In addition to this, it seems like WiseTech Global’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to fall back down to an attractive buying range, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will WiseTech Global generate?

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 98% over the next couple of years, the future seems bright for WiseTech Global. 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? WTC’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe WTC should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on WTC for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for WTC, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

If you'd like to know more about WiseTech Global as a business, it's important to be aware of any risks it's facing. For example, we've discovered 2 warning signs that you should run your eye over to get a better picture of WiseTech Global.

If you are no longer interested in WiseTech Global, 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.