What does the stock price of West Fraser Timber Co. Ltd. (TSE:WFG)?

West Fraser Timber Co. Ltd. (TSE:WFG), isn’t the biggest company, but it’s seen decent teen-level share price growth on the TSX over the past few months. As a mid-cap stock with high analyst coverage, you can assume that any recent changes in the company’s outlook are already priced into the stock. However, what if the stock is still a bargain? Today, I will analyze the most recent West Fraser Timber outlook and valuation data to see if the opportunity still exists.

Check out our latest analysis for West Fraser Timber

What is West Fraser Timber worth?

Good news, investors! West Fraser Timber is still a bargain right now. According to my assessment, the intrinsic value of the stock is CA$142.96, but it is currently trading at CA$108 in the stock market, which means there is still a buying opportunity now. However, there may be another chance to buy again in the future. This is because West Fraser Timber’s beta (a measure of stock price volatility) is high, meaning that its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s stock will likely fall more than the rest of the market, providing an excellent buying opportunity.

What does the future of West Fraser Timber look like?

TSX: WFG Earnings and Revenue Growth July 19, 2022

Investors looking for portfolio growth may want to consider a company’s prospects before buying its stock. Although value investors argue that it is intrinsic value relative to price that matters most, a more compelling investment thesis would be high growth potential at a cheap price. Although in the case of West Fraser Timber, it is expected to post very negative earnings growth in the coming years, which does not help to strengthen its investment thesis. It seems that the risk of future uncertainty is high, at least in the short term.

What does this mean to you :

Are you a shareholder? Although WFG is currently undervalued, the unfavorable outlook of negative growth carries a degree of risk. Consider whether you want to increase your portfolio’s exposure to WFG or whether diversifying into another security may be a better decision for your total risk and return.

Are you a potential investor? If you’ve been keeping tabs on WFG for a while, but are hesitant to take the plunge, I recommend doing some more in-depth research on the stock. Given its current undervaluation, now is the time to make a decision. But keep in mind the risks that come with a negative growth outlook going forward.

If you want to dive deeper into West Fraser Timber, you should also look at the risks it currently faces. For example, we found 1 warning sign which you should browse to get a better picture of West Fraser Timber.

If you are no longer interested in West Fraser Timber, you can use our free platform to view our list of over 50 other stocks with high growth potential.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.