What Does WillScot Mobile Mini Holdings Corp.'s (NASDAQ:WSC) Share Price Indicate?

WillScot Mobile Mini Holdings Corp. (NASDAQ:WSC), might not be a large cap stock, but it received a lot of attention from a substantial price movement on the NASDAQCM over the last few months, increasing to US$40.25 at one point, and dropping to the lows of US$32.20. 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 WillScot Mobile Mini Holdings' current trading price of US$33.49 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 WillScot Mobile Mini Holdings’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 WillScot Mobile Mini Holdings

Is WillScot Mobile Mini Holdings still cheap?

WillScot Mobile Mini Holdings is currently expensive based on my price multiple model, where I look at the company's price-to-earnings ratio in comparison to the industry average. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that WillScot Mobile Mini Holdings’s ratio of 36.02x is above its peer average of 23.37x, which suggests the stock is trading at a higher price compared to the Construction industry. But, is there another opportunity to buy low in the future? Since WillScot Mobile Mini Holdings’s share price is quite volatile, this could mean it can sink lower (or rise even further) in the future, giving us another chance to invest. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of WillScot Mobile Mini Holdings look like?

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. WillScot Mobile Mini Holdings' earnings over the next few years are expected to increase by 87%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? It seems like the market has well and truly priced in WSC’s positive outlook, with shares trading above industry price multiples. However, this brings up another question – is now the right time to sell? If you believe WSC should trade below its current price, selling high and buying it back up again when its price falls towards the industry PE ratio can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.

Are you a potential investor? If you’ve been keeping an eye on WSC for a while, now may not be the best time to enter into the stock. The price has surpassed its industry peers, which means it is likely that there is no more upside from mispricing. However, the optimistic prospect is encouraging for WSC, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

If you want to dive deeper into WillScot Mobile Mini Holdings, you'd also look into what risks it is currently facing. In terms of investment risks, we've identified 1 warning sign with WillScot Mobile Mini Holdings, and understanding it should be part of your investment process.

If you are no longer interested in WillScot Mobile Mini 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.