Q: Hi Peter & 5i team,
Thinking of adding more WSP global for a long term hold. What do you think of the stock price today versus earnings growth.
Thank you
Thinking of adding more WSP global for a long term hold. What do you think of the stock price today versus earnings growth.
Thank you
5i Research Answer:
WSP is not cheap, but investors like its backlog, consistency, reliability and potential. EPS growth is in the 15% range, so its 28X earnings mutliple is on the high side for sure. But the company has executed very well. It has made good acquisitions and likely will make more, which could boost its growth rate further. As it gets bigger it should be 'safer'. Lower rates could improve its valuation and outlook. Thus, we would be comfortable buying.