WiseTech Global (ASX:WTC)
Good morning Team, In view of Hormuz, what is your valued opinion of WTC? Regards, John
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Answer
Hi John,
WiseTech Global (WTC) has come under heavy selling pressure, falling more than 30% year-to-date to around ~$44, primarily driven by broader SaaS de-rating and AI disruption concerns rather than any clear deterioration in fundamentals – this has been a global phenomenon across the software space, while WTC is also exposed to freight volumes, which is being caught up in the conflict. Recent results were solid, with H1 FY26 revenue and earnings both beating expectations, while the stock now trades well below its historical valuation multiples.
- The AI derating in WTC has led to the the stock to currently trading ~60% below its 5-year average valuation.
However, the bear case shouldn’t be dismissed. AI poses a legitimate long-term threat if it meaningfully changes how logistics software is used, potentially narrowing WTC’s competitive advantage. But at the same time, the company is dealing with integration challenges following the E2 acquisition and has trimmed staff, highlighting some execution risk.
- While we believe that WTC could easily be a net beneficiary of AI it’s a fluid backdrop.
The current macro backdrop, including risks around the Strait of Hormuz, is a near-term headwind for sentiment, with investors typically rotating out of high-multiple tech during periods of uncertainty. However, looking further out, increased supply chain complexity, rerouting, and compliance demands play directly into WTC’s strengths. As we saw during COVID, disruption can accelerate adoption of platforms like CargoWise, suggesting the current weakness may present an opportunity for long-term investors, albeit with an acceptance of ongoing volatility.
- We remain long and bullish towards WTC, but it’s been an uncomfortable ride so far.
