GFL Environmental (TSX:GFL): Evaluating Valuation After Recent Share Price Dip and Long-Term Growth

GFL Environmental (TSX:GFL) shares have delivered a solid 14% return over the past year, even as the past month saw a slight decline. Investors may be weighing recent performance trends in relation to the company’s longer growth record.

See our latest analysis for GFL Environmental.

GFL Environmental’s share price recently slipped less than 2% over the past month. Its one-year total shareholder return of 14% and a standout 92% over three years point to sustained long-term momentum. After the steady advance, this latest dip may simply reflect shifting investor sentiment or profit taking, rather than any deeper change in underlying performance.

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With the share price hovering below analyst targets and recent growth numbers sending mixed signals, investors now face a key question: is there hidden value in GFL Environmental or are markets fully pricing in its future prospects?

Most Popular Narrative: 15.4% Undervalued

According to the most widely followed narrative, GFL Environmental’s fair value estimate sits about 15% above the recent closing price of CA$64.08. This sets the stage for a closer look at the drivers behind this outlook.

The company is investing significantly in sustainability-related projects like EPR and RNG. These initiatives are anticipated to boost future revenue and earnings through increased efficiency and new revenue streams. The planned sale of the ES business will improve the balance sheet, enabling share buybacks and increased dividends, which could enhance earnings per share (EPS) and overall shareholder value.

Read the complete narrative.

Curious what assumptions justify a price target well above today’s value? This narrative is built on projected breakthroughs in financial performance and a transformation of the company’s earnings power. Only by reading the full narrative will you discover which numbers and strategic moves underpin the bullish case.

Result: Fair Value of $75.78 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, unexpected impacts from commodity price swings or a slower than anticipated turnaround in earnings could challenge the optimistic case for GFL Environmental's valuation.

Find out about the key risks to this GFL Environmental narrative.

Build Your Own GFL Environmental Narrative

If you see the story differently, or want to dig into the data yourself, you can easily build your own perspective in just a few minutes with Do it your way.

A great starting point for your GFL Environmental research is our analysis highlighting 2 key rewards and 4 important warning signs that could impact your investment decision.

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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.

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