Let's talk about the popular Waste Connections, Inc. (NYSE:WCN). The company's shares received a lot of attention from a substantial price movement on the NYSE over the last few months, increasing to US$193 at one point, and dropping to the lows of US$170. 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 Waste Connections' current trading price of US$186 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Waste Connections’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Waste Connections

Is Waste Connections Still Cheap?

The stock seems fairly valued at the moment according to our valuation model. It’s trading around 1.16% above our intrinsic value, which means if you buy Waste Connections today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth $183.63, then there isn’t really any room for the share price grow beyond what it’s currently trading. Furthermore, Waste Connections’s low beta implies that the stock is less volatile than the wider market.

What does the future of Waste Connections look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. Waste Connections' earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What This Means For You

Are you a shareholder? It seems like the market has already priced in WCN’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on WCN, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Keep in mind, when it comes to analysing a stock it's worth noting the risks involved. At Simply Wall St, we found 2 warning signs for Waste Connections and we think they deserve your attention.

If you are no longer interested in Waste Connections, 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.