Let's talk about the popular Expeditors International of Washington, Inc. (NASDAQ:EXPD). The company's shares saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$127 and falling to the lows of US$108. 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 Expeditors International of Washington's current trading price of US$108 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at Expeditors International of Washington's outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Expeditors International of Washington
Is Expeditors International of Washington Still Cheap?
The stock seems fairly valued at the moment according to my valuation model. It's trading around 11% below my intrinsic value, which means if you buy Expeditors International of Washington today, you'd be paying a fair price for it. And if you believe that the stock is really worth $120.60, then there isn't much room for the share price grow beyond what it's currently trading. In addition to this, Expeditors International of Washington has a low beta, which suggests its share price is less volatile than the wider market.
Can we expect growth from Expeditors International of Washington?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. However, with a negative profit growth of -19% expected over the next couple of years, near-term growth certainly doesn't appear to be a driver for a buy decision for Expeditors International of Washington. This certainty tips the risk-return scale towards higher risk.
What This Means For You
Are you a shareholder? EXPD seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to de-risk your portfolio. Is your current exposure to the stock beneficial for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on the stock, take a look at whether its fundamentals have changed.
Are you a potential investor? If you've been keeping tabs on EXPD for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The stock appears to be trading at fair value, which means there's less benefit from mispricing. Furthermore, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven't considered today, which can help gel your views on EXPD should the price fluctuate below its true value.
So while earnings quality is important, it's equally important to consider the risks facing Expeditors International of Washington at this point in time. Every company has risks, and we've spotted 1 warning sign for Expeditors International of Washington you should know about.
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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.