Wise's Nasdaq move and index inclusion put global expansion in focus

Wise (WSE) recently shifted its primary listing to Nasdaq and was added to the NASDAQ Composite Index, a combination that draws new attention to how the cross border payments company is scaling its global footprint.

Short term volatility has picked up, with Wise stock falling around 8% on the day to US$14.17 despite recent Nasdaq listing, index inclusion and product launches. At the same time, a 3 year total shareholder return of about 95% points to strong longer term gains.

If Wise’s listing shift has you thinking about where payments and fintech could go next, it may be worth scanning for other fast growing opportunities among 60 profitable AI stocks that aren't just burning cash

With Wise’s Nasdaq debut, index inclusion and fresh products rolling out, the stock’s recent pullback sits against a 3 year total return near 95%. This raises a key question: is there still a buying opportunity here, or has the market already priced in future growth?

Preferred P/E of 27.5x: Is it justified?

Wise currently trades on a P/E of 27.5x, which sets a relatively rich bar for a stock that just closed at $14.17.

The P/E multiple compares the current share price to earnings per share, so it effectively tells you how many dollars investors are paying for each dollar of earnings.

For Wise, that 27.5x figure sits below the peer group average of 32.1x, which suggests the stock is priced at a discount to similar companies using this metric. However, it is well above the US Diversified Financial industry average of 17x and also above the estimated fair P/E of 16.5x, so the valuation can appear stretched when lined up against the wider sector and the level the market could move towards over time.

Result: Price-to-Earnings of 27.5x (OVERVALUED)

However, you also need to weigh risks such as a potential de rating if earnings stumble, or regulatory changes affecting cross border fees and volumes.

Another way to look at Wise's valuation

While the P/E of 27.5x already looks demanding against the industry and the fair ratio of 16.5x, it still sits below peers at 32.1x. That gap can cut both ways, either as a cushion if sentiment cools or a ceiling if growth expectations slip. Where do you think the market leans next?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Wise for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 44 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

If the mix of optimism and caution so far feels familiar, that is exactly why it helps to look at the numbers yourself and move quickly while sentiment is still settling. To balance the risks you have seen with what the market likes about Wise right now, take a closer look at 1 key reward.

Looking for more investment ideas?

Do not stop with a single stock. Broaden your watchlist now, compare different angles on quality and risk, and give yourself better options before the next move.

• Target potential mispricing by scanning for quality companies trading below what their fundamentals may support through the 44 high quality undervalued stocks.
• Strengthen your income stream by focusing on reliable payers with higher yields using the 13 dividend fortresses.
• Prioritise resilience by filtering for companies with sturdy finances and fundamentals through the solid balance sheet and fundamentals stocks screener (46 results).

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.