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At $38.35, Is Werner Enterprises Inc (NASDAQ:WERN) A Buy?

Werner Enterprises Inc (NASDAQ:WERN), a road and rail company based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NasdaqGS. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Today I will analyse the most recent data on Werner Enterprises’s outlook and valuation to see if the opportunity still exists. See our latest analysis for Werner Enterprises

What is Werner Enterprises worth?

Werner Enterprises appears to be overvalued according to my relative valuation model. In this instance, I’ve used the price-to-equity (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Werner Enterprises’s ratio of 33.1x is above its peer average of 19.6x, which suggests the stock is overvalued compared to the road and rail industry. Another thing to keep in mind is that Werner Enterprises’s share price is quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again.

What does the future of Werner Enterprises look like?

NasdaqGS:WERN Future Profit Dec 17th 17
NasdaqGS:WERN Future Profit Dec 17th 17

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. With profit expected to grow by 50.12% over the next couple of years, the future seems bright for Werner Enterprises. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? Werner Enterprises’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe Werner Enterprises should trade below its current price, selling high and buying it back up again when its price falls towards its real value 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 Werner Enterprises 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 Werner Enterprises, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Werner Enterprises. You can find everything you need to know about Werner Enterprises in the latest infographic research report. If you are no longer interested in Werner Enterprises, you can use our free platform to see my list of over 50 other stocks with a high growth potential.


To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.

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