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Is Unilever plc (UL) Stock Trading Below Fair Value?

Thursday, August 18, 2022 10:01 AM | InvestorsObserver Analysts
Is Unilever plc (UL) Stock Trading Below Fair Value?

InvestorsObserver gives Unilever plc (UL) a weak valuation score of 26 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. UL currently holds a better value than 26% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.

Valuation Rank - 26
UL gets a 26 Valuation Rank today. Find out what this means to you and get the rest of the rankings on UL!

Metrics Analysis

UL has a trailing twelve month Price to Earnings (PE) ratio of 19.8 which places it around the histroical average of roughly 15. UL is currently trading at a average value due to investors paying around what the stock is worth in relation to its earnings. UL's trailing-12-month earnings per share (EPS) of 4.00 does justify its share price in the market. Trailing PE ratios do not factor in the company's projected growth rate, thus, some firms will have high PE ratios caused by high growth recruiting more investors even if the underlying company has produced low earnings so far.
UL currently has a 12-month-forward-PE-to-Growth (PEG) ratio of 3.24. The market is currently overvaluing UL in relation to its projected growth due to the PEG ratio being above the fair market value of 1. UL's PEG comes from its forward price to earnings ratio being divided by its growth rate. Because PEG ratios include more fundamentals of a company's overall health with additional focus on the future, they are one of the most used valuation metrics by analysts.

Summary

UL's valuation metrics are weak at its current price due to a overvalued PEG ratio due to strong growth. UL's PE and PEG are worse than the market average resulting in a below average valuation score. Click Here to get the full Report on Unilever plc (UL) stock.

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