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Is Koninklijke Philips NV (PHG) Stock Over or Undervalued?

Tuesday, September 27, 2022 10:13 AM | InvestorsObserver Analysts
Is Koninklijke Philips NV (PHG) Stock Over or Undervalued?

Koninklijke Philips NV (PHG) receives a strong valuation ranking of 87 from InvestorsObserver data analysis. The proprietary ranking system focuses on the underlying health of a company through analysis of its stock price, earnings, and growth rate. PHG has a better value than 87% of stocks based on these valuation analytics. Investors primarily focused on buy-and-hold strategies will find the valuation ranking relevant to their goals when making investment decisions.

Valuation Rank - 87
PHG gets a 87 Valuation Rank today. Find out what this means to you and get the rest of the rankings on PHG!

Metrics Analysis

PHG has a trailing twelve month Price to Earnings (PE) ratio of 4.5. The historical average of roughly 15 shows a good value for PHG stock as investors are paying lower share prices relative to the company's earnings. PHG's low trailing PE ratio shows that the firm has been trading below its fair market value recently. Its trailing 12-month earnings per share (EPS) of 1.61 more than justifies the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.
PHG's 12-month-forward PE to Growth (PEG) ratio of 1.2 is considered a roughly average value as the market is valuing PHG right in line with its projected earnings growth. PHG's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.

Summary

PHG's valuation metrics are adequate at its current price due to a fairly valued PEG ratio due to strong growth. PHG's PE and PEG are around the market average resulting in a average valuation score. Click Here to get the full Report on Koninklijke Philips NV (PHG) stock.

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