Assessing Expeditors International of Washington (EXPD) Valuation After Recent Share Price Momentum

Expeditors International of Washington (EXPD) offers a unique window into the logistics sector, particularly as global supply chain dynamics continue to evolve. Investors may be watching the company for signs of where freight trends could head next.

See our latest analysis for Expeditors International of Washington.

After a turbulent start to the year, Expeditors International of Washington’s shares have picked up momentum, climbing 9% year-to-date. While the one-year total shareholder return is nearly flat at just 0.8%, a strong 7-day share price return of 6% suggests renewed investor confidence and a possible shift in sentiment for the months ahead.

If you’re looking to widen your investing lens beyond logistics, now could be the perfect time to discover fast growing stocks with high insider ownership.

But with shares now trading slightly above analysts’ consensus price targets and growth metrics showing only modest improvement, investors may be left wondering whether Expeditors International of Washington is truly undervalued or if the market has already accounted for any future gains.

Price-to-Earnings of 19.1x: Is it justified?

Expeditors International of Washington currently trades at a price-to-earnings (P/E) ratio of 19.1x, putting its valuation above the sector norm. With a last close price of $119.92, the stock appears expensive when viewed strictly through this lens.

The P/E ratio measures the price investors are willing to pay for each dollar of earnings, making it a central gauge for companies in the logistics sector where stable earnings matter. A higher P/E often signals that the market expects robust future profits or enduring competitive advantages.

For Expeditors, the elevated P/E ratio could indicate that the market anticipates continued outperformance. However, this number stands well above the global logistics industry average of 15.7x. This discrepancy suggests investors are factoring in expectations well above what peers might enjoy. Relative to an estimated 'fair' P/E of 12x, which is where the ratio could reasonably revert, the shares also look stretched and could face future revaluation.

Explore the SWS fair ratio for Expeditors International of Washington

Result: Price-to-Earnings of 19.1x (OVERVALUED)

However, revenue and net income growth remain subdued. Any persistent slowdown or disappointing results could challenge the market’s optimistic outlook.

Find out about the key risks to this Expeditors International of Washington narrative.

Another View: Discounted Cash Flow Sheds Different Light

While P/E ratios suggest Expeditors International of Washington is expensive, our DCF model offers a contrasting signal. It estimates fair value at $153.57 per share, over 21% higher than today’s price. This implies shares may actually be undervalued. Can this model’s optimism stand up to reality?

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 Expeditors International of Washington 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 Expeditors International of Washington Narrative

If you think there’s another story to tell or want to dig deeper into the numbers, you can create your own view of Expeditors International of Washington in just a few minutes. Do it your way.

A great starting point for your Expeditors International of Washington research is our analysis highlighting 2 key rewards and 2 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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