Q: WSP Global stock has grossly underperformed its Canadian peers STN and ATRL over 5 Yrs, 1 yr and YTD. ( 1 Yr: 7% v/s 34% ). And the pattern does not appear to change, even after recent earnings. We know that WSP has been held in 5i portfolios for many years and consistently recommended.
Could you please help us understand the reasons for the disparity and rationale to continue to own the stock vis a vis switching to any of the other two ?
BTW: From a technical perspective, stock seems to have lost its momentum and now trading below its 200 Day MA.
Thank You
Could you please help us understand the reasons for the disparity and rationale to continue to own the stock vis a vis switching to any of the other two ?
BTW: From a technical perspective, stock seems to have lost its momentum and now trading below its 200 Day MA.
Thank You
5i Research Answer:
The last year is the main reason for the one and five year underperformance. In fairness, they have also outperformed handily over 10 years. It is a well run company that has been able to grow consistently over the years, is diversified globally and has a reasonable valuation. All stocks will have periods where they lag either peers or the market and WSP is no different. Recent results looked fine but there as a bit decline in organic growth due to the emergency response business being slower than last year, an area that is largely out of the company's ocntrol. We don't see much reason to change a view on WSP at this stage.