A Fresh Look at WaFd (WAFD) Valuation After Recent Share Price Trends

WaFd (WAFD) shares have moved only slightly over the past day, with modest volatility over the past month as well. Investors may be watching closely to see how ongoing performance trends shape upcoming results.

See our latest analysis for WaFd.

Looking beyond the recent modest volatility, WaFd’s share price has trended lower this year, with a 1-year total shareholder return of -14.54%. The longer-term picture tells a different story, thanks to solid gains over five years, though current momentum is clearly on the softer side.

If you’re curious about opportunities beyond the banking sector, this could be the perfect time to broaden your search and discover fast growing stocks with high insider ownership

With WaFd shares trading below both analyst targets and estimated intrinsic value, the key question now is whether the market is overlooking the potential for a rebound or is fully accounting for future growth prospects.

Price-to-Earnings of 10.4x: Is it justified?

WaFd’s stock is trading at a price-to-earnings (P/E) ratio of just 10.4x, notably below both its own industry and broader market averages. This makes the current share price appear undervalued relative to peer benchmarks.

The P/E ratio tells investors how much they are paying for each dollar of the company's earnings. In the banking industry, it is a closely watched measure for comparing companies with similar capital structures and profitability.

This discount suggests that investors may be underestimating WaFd’s underlying profit strength. The P/E is not only far below the peer average of 15.6x but is also below the estimated fair price-to-earnings ratio of 12.1x. This indicates potential for the market to re-rate the stock if sentiment improves.

Result: Price-to-Earnings of 10.4x (UNDERVALUED)

Explore the SWS fair ratio for WaFd

However, slower recent revenue and net income growth, combined with negative short-term returns, could challenge any quick reversal in market sentiment.

Find out about the key risks to this WaFd narrative.

Another View: Discounted Cash Flow Perspective

For another angle, our DCF model puts WaFd’s fair value at $41.01, which is well above its current price of $28.07. This suggests the stock may be significantly undervalued by the market right now. However, could this gap indicate overlooked upside, or are there risks that the model might miss?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out WaFd for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own WaFd Narrative

If you see the numbers differently or want to reach your own conclusion, building your personalized WaFd story only takes a few minutes. Do it your way

A good starting point is our analysis highlighting 5 key rewards investors are optimistic about regarding WaFd.

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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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