While WNS (Holdings) Limited (NYSE:WNS) might not be the most widely known stock at the moment, it received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$70.19 at one point, and dropping to the lows of US$53.23. 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 WNS (Holdings)'s current trading price of US$58.41 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let's take a look at WNS (Holdings)'s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for WNS (Holdings)
What's The Opportunity In WNS (Holdings)?
The stock seems fairly valued at the moment according to my valuation model. It's trading around 1.42% above my intrinsic value, which means if you buy WNS (Holdings) today, you'd be paying a relatively reasonable price for it. And if you believe the company's true value is $57.59, there's only an insignificant downside when the price falls to its real value. So, is there another chance to buy low in the future? Given that WNS (Holdings)'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.
What kind of growth will WNS (Holdings) generate?
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. However, with a relatively muted profit growth of 8.7% expected over the next couple of years, growth doesn't seem like a key driver for a buy decision for WNS (Holdings), at least in the short term.
What This Means For You
Are you a shareholder? WNS's future growth appears to have been factored into the current share price, 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 conviction to buy should the price fluctuates below the true value?
Are you a potential investor? If you've been keeping tabs on WNS, now may not be the most optimal 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.
Since timing is quite important when it comes to individual stock picking, it's worth taking a look at what those latest analysts forecasts are. At Simply Wall St, we have the analysts estimates which you can view by clicking here.
If you are no longer interested in WNS (Holdings), you can use our free platform to see our list of over 50 other stocks with a high growth potential.
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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.