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Wajax Corporation (TSE:WJX), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the TSX over the last few months, increasing to CA$34.59 at one point, and dropping to the lows of CA$25.90. 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 Wajax's current trading price of CA$25.90 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 Wajax’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 Wajax
Is Wajax Still Cheap?
Great news for investors – Wajax is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is CA$41.01, but it is currently trading at CA$25.90 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Wajax’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Can we expect growth from Wajax?
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. 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. Though in the case of Wajax, it is expected to deliver a relatively unexciting top-line growth of 8.6% in the next few years, 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? Even though growth is relatively muted, since WJX is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on WJX for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy WJX. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.