Wabash National Corporation (NYSE:WNC), a machinery company based in United States, saw significant share price volatility over the past couple of months on the NYSE, rising to the highs of $26.24 and falling to the lows of $20.08. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether Wabash National’s current trading price of $20.81 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Wabash National’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 Wabash National
Is Wabash National still cheap?According to my valuation model, Wabash National seems to be fairly priced at around 16.79% below my intrinsic value, which means if you buy Wabash National today, you’d be paying a fair price for it. And if you believe that the stock is really worth $25.01, then there’s not much of an upside to gain from mispricing. So, is there another chance to buy low in the future? Given that Wabash National’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.
Can we expect growth from Wabash National?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. Though in the case of Wabash National, it is expected to deliver a relatively unexciting earnings growth of 9.63%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What this means for you:
Are you a shareholder? It seems like the market has already priced in WNC’s future outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor? If you’ve been keeping an eye on WNC, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Wabash National. You can find everything you need to know about Wabash National in the latest infographic research report. If you are no longer interested in Wabash National, you can use our free platform to see my list of over 50 other stocks with a high growth potential.