Gamma Communications plc

AIM:GAMA Stock Report

Market Cap: UK£1.5b

Gamma Communications Valuation

Is GAMA undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of GAMA when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: GAMA (£15.76) is trading below our estimate of fair value (£20.88)

Significantly Below Fair Value: GAMA is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for GAMA?

Key metric: As GAMA is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for GAMA. This is calculated by dividing GAMA's market cap by their current earnings.
What is GAMA's PE Ratio?
PE Ratio26.8x
EarningsUK£56.40m
Market CapUK£1.51b

Price to Earnings Ratio vs Peers

How does GAMA's PE Ratio compare to its peers?

The above table shows the PE ratio for GAMA vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average20.7x
TIMECOM TIME dotCom Berhad
22x11.8%RM 8.7b
BT.A BT Group
20.3x14.1%UK£15.5b
9418 U-NEXT HOLDINGSLtd
6.4x6.8%JP¥97.6b
CJLU NetLink NBN Trust
34.1x5.4%S$3.4b
GAMA Gamma Communications
26.8x12.7%UK£1.5b

Price-To-Earnings vs Peers: GAMA is expensive based on its Price-To-Earnings Ratio (26.8x) compared to the peer average (20.7x).

Price to Earnings Ratio vs Industry

How does GAMA's PE Ratio compare vs other companies in the European Telecom Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
GAMA 26.8xIndustry Avg. 18.2xNo. of Companies6PE01020304050+
0 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: GAMA is expensive based on its Price-To-Earnings Ratio (26.8x) compared to the European Telecom industry average (18.2x).

Price to Earnings Ratio vs Fair Ratio

What is GAMA's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

GAMA PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio26.8x
Fair PE Ratio18.6x

Price-To-Earnings vs Fair Ratio: GAMA is expensive based on its Price-To-Earnings Ratio (26.8x) compared to the estimated Fair Price-To-Earnings Ratio (18.6x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst GAMA forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUK£15.76
UK£18.72
+18.8%
13.3%UK£23.00UK£14.50n/a9
Nov ’25UK£16.10
UK£18.61
+15.6%
12.8%UK£23.00UK£14.50n/a9
Oct ’25UK£16.38
UK£18.61
+13.6%
12.8%UK£23.00UK£14.50n/a9
Sep ’25UK£15.32
UK£17.71
+15.6%
16.7%UK£22.50UK£11.50n/a9
Aug ’25UK£15.08
UK£17.71
+17.4%
16.7%UK£22.50UK£11.50n/a9
Jul ’25UK£14.18
UK£17.71
+24.9%
16.7%UK£22.50UK£11.50n/a9
Jun ’25UK£14.52
UK£17.45
+20.2%
17.4%UK£22.50UK£11.50n/a8
May ’25UK£13.10
UK£16.90
+29.0%
18.9%UK£22.50UK£11.50n/a8
Apr ’25UK£13.68
UK£16.90
+23.5%
18.9%UK£22.50UK£11.50n/a8
Mar ’25UK£12.46
UK£16.11
+29.3%
19.8%UK£20.90UK£11.50n/a8
Feb ’25UK£11.68
UK£16.17
+38.5%
21.1%UK£20.90UK£11.50n/a7
Jan ’25UK£11.26
UK£16.08
+42.8%
20.5%UK£20.50UK£11.50n/a7
Dec ’24UK£10.74
UK£16.01
+49.0%
20.0%UK£20.25UK£11.50n/a7
Nov ’24UK£10.76
UK£16.01
+48.8%
20.0%UK£20.25UK£11.50UK£16.107
Oct ’24UK£10.92
UK£16.07
+47.2%
20.4%UK£20.70UK£11.50UK£16.387
Sep ’24UK£10.70
UK£16.03
+49.8%
20.6%UK£20.70UK£11.50UK£15.327
Aug ’24UK£11.10
UK£16.03
+44.4%
20.6%UK£20.70UK£11.50UK£15.087
Jul ’24UK£11.42
UK£16.20
+41.9%
21.8%UK£20.70UK£11.50UK£14.186
Jun ’24UK£11.50
UK£16.20
+40.9%
21.8%UK£20.70UK£11.50UK£14.526
May ’24UK£11.62
UK£15.74
+35.5%
21.9%UK£20.70UK£11.50UK£13.107
Apr ’24UK£10.80
UK£15.61
+44.6%
21.0%UK£20.00UK£11.50UK£13.687
Mar ’24UK£11.76
UK£16.34
+39.0%
20.6%UK£20.00UK£11.50UK£12.467
Feb ’24UK£11.70
UK£16.34
+39.7%
20.6%UK£20.00UK£11.50UK£11.687
Jan ’24UK£10.82
UK£16.34
+51.0%
20.6%UK£20.00UK£11.50UK£11.267
Dec ’23UK£10.96
UK£16.81
+53.4%
18.5%UK£20.00UK£11.50UK£10.747
Nov ’23UK£10.96
UK£16.81
+53.4%
18.5%UK£20.00UK£11.50UK£10.767

Analyst Forecast: Target price is less than 20% higher than the current share price.

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