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Is NorthWestern Corp (NWE) Stock Trading Below Fair Value?

Thursday, January 26, 2023 03:32 PM | InvestorsObserver Analysts

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Is NorthWestern Corp (NWE) Stock Trading Below Fair Value?

NorthWestern Corp (NWE) receives a weak valuation ranking of 3 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. NWE has a better value than 3% 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 - 3
NWE gets a 3 Valuation Rank today. Find out what this means to you and get the rest of the rankings on NWE!

Metrics Analysis

NWE has a trailing twelve month Price to Earnings (PE) ratio of 18.6. The historical average of roughly 15 shows a average value for NWE stock as investors are paying fair share prices relative to the company's earnings. NWE's average trailing PE ratio shows that the firm has been trading around its fair market value recently. Its trailing 12-month earnings per share (EPS) of 3.05 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.
NWE has a 12 month forward PE to Growth (PEG) ratio of 9.15. Markets are overvaluing NWE in relation to its projected growth as its PEG ratio is currently above the fair market value of 1. 3.05's PEG comes from its forward price to earnings ratio being divided by its growth rate. PEG ratios are one of the most used valuation metrics due to its incorporation of more company fundamentals metrics and a focus on the firm's future rather than its past.


NWE' has a weak valuation at its current share price on account of a overvalued PEG ratio due to strong growth. NWE's PE and PEG are worse than the market average leading to a below average valuation score. Click Here to get the full Report on NorthWestern Corp (NWE) stock.

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