WiseTech Global Ltd (ASX: WTC) shares are in the red today.
Shares in the S&P/ASX 200 Index (ASX: XJO) logistics solutions company closed yesterday trading for $125.60. In morning trade on Wednesday, shares are changing hands for $124.14 apiece, down 1.1%.
For some context, the ASX 200 is down 0.1% at this same time.
As you can see on the chart above, there have been some very volatile share price moves over the past two months. The big swings were initially driven by allegations against CEO Richard White concerning inappropriate behaviours.
Shares again came under pressure following a modest guidance downgrade on 22 November.
Despite those bumps in the road, WiseTech shares remain up 83% since this time last year. And that doesn't include the 16.9 cents a share in fully franked dividends eligible investors will have received over this time.
But with this strong run behind it, should investors consider cashing in some gains?
Time to take some profits on WiseTech shares?
According to Dylan Evans of Catapult Wealth, taking some profits now is worth considering (courtesy of The Bull).
"WiseTech develops and provides software solutions to the global logistics industry," said Evans, who has a sell recommendation on WiseTech shares.
Commenting on the FY 2024 growth metrics that have spurred ASX 200 investor enthusiasm, Evans said:
The company lifted total revenue by 28% in fiscal year 2024 when compared to the prior corresponding period. Statutory net profit after tax was up 24%. The shares have risen from $99.37 on October 24 to trade at $133.68 on December 5.
High expectations are built into the shares, which are trading on a lofty price/earnings ratio. Any miss in expectations may significantly impact the share price.
Since 5 December, WiseTech shares have dipped to $124.14 apiece, though that still puts the stock at a P/E ratio of about 160 times.
With that in mind, Evans concluded, "Investors may want to consider cashing in some gains at these levels."
The bullish case
A number of prominent analysts and brokers remain bullish on the outlook for WiseTech shares.
Following the company's investor day on 3 December, Goldman Sachs reiterated its buy rating on the ASX 200 company.
The broker noted:
WTC hosted its investor day today and provided a detailed overview of its product roadmap and plans to become the operating system for global logistics, alongside highlighting the breadth and depth of its executive team.
Goldman's three key takeaways from the presentation were:
- Detailed product presentations highlighted the opportunity to deliver significant long-term growth.
- Current operating momentum remains strong.
- WTC is confident that its new leadership structure will work, with Richard White expected to spend more time on driving product development and strategy.
Goldman Sachs has a 12-month price target of $138.00 on WiseTech shares. That represents a potential upside of 11% from current levels.
