Reece Valuation

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

Valuation Score

0/6

Valuation Score 0/6

  • 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 REH when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: REH (A$28.1) is trading above our estimate of fair value (A$17.3)

Significantly Below Fair Value: REH is trading above our estimate of fair value.


Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

REH key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue2.2x
Enterprise Value/EBITDA25.1x
PEG Ratio5x

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for REH vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average20.8x
SVW Seven Group Holdings
30x20.4%AU$14.9b
RDX Redox
18.7x10.6%AU$1.6b
EHL Emeco Holdings
6.3x12.1%AU$366.9m
IPG IPD Group
28.3x26.0%AU$497.3m
REH Reece
42.7x8.5%AU$18.2b

Price-To-Earnings vs Peers: REH is expensive based on its Price-To-Earnings Ratio (42.7x) compared to the peer average (20.8x).


Price to Earnings Ratio vs Industry

How does REH's PE Ratio compare vs other companies in the Global Trade Distributors Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a14.1%
n/an/an/a
No. of CompaniesPE048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a14.1%
n/an/an/a
No more companies

Price-To-Earnings vs Industry: REH is expensive based on its Price-To-Earnings Ratio (42.7x) compared to the Global Trade Distributors industry average (14.6x).


Price to Earnings Ratio vs Fair Ratio

What is REH'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.

REH PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio42.7x
Fair PE Ratio22.4x

Price-To-Earnings vs Fair Ratio: REH is expensive based on its Price-To-Earnings Ratio (42.7x) compared to the estimated Fair Price-To-Earnings Ratio (22.4x).


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 REH forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentAU$28.10
AU$20.09
-28.5%
19.4%AU$28.90AU$13.50n/a11
Mar ’25AU$27.30
AU$20.09
-26.4%
19.4%AU$28.90AU$13.50n/a11
Feb ’25AU$22.09
AU$15.32
-30.7%
13.9%AU$20.35AU$12.00n/a11
Jan ’25AU$22.39
AU$15.01
-33.0%
13.5%AU$20.35AU$12.00n/a11
Dec ’24AU$19.36
AU$15.05
-22.3%
14.2%AU$20.80AU$12.00n/a11
Nov ’24AU$17.52
AU$15.12
-13.7%
13.8%AU$20.80AU$12.00n/a11
Oct ’24AU$18.63
AU$15.08
-19.1%
14.0%AU$20.25AU$12.00n/a10
Sep ’24AU$20.26
AU$15.08
-25.6%
14.0%AU$20.25AU$12.00n/a10
Aug ’24AU$19.30
AU$14.58
-24.4%
12.3%AU$18.43AU$11.00n/a10
Jul ’24AU$18.57
AU$14.48
-22.0%
13.0%AU$18.43AU$11.00n/a9
Jun ’24AU$18.20
AU$14.48
-20.4%
13.0%AU$18.43AU$11.00n/a9
May ’24AU$18.46
AU$14.48
-21.6%
13.0%AU$18.43AU$11.00n/a9
Apr ’24AU$17.35
AU$13.99
-19.4%
10.2%AU$15.60AU$11.00n/a7
Mar ’24AU$16.31
AU$13.99
-14.3%
10.2%AU$15.60AU$11.00AU$27.307
Feb ’24AU$16.22
AU$14.39
-11.3%
12.2%AU$16.80AU$11.00AU$22.097
Jan ’24AU$14.15
AU$14.83
+4.8%
11.5%AU$16.80AU$11.00AU$22.397
Dec ’23AU$15.85
AU$14.83
-6.5%
11.5%AU$16.80AU$11.00AU$19.367
Nov ’23AU$15.49
AU$14.83
-4.3%
11.5%AU$16.80AU$11.00AU$17.527
Oct ’23AU$14.02
AU$15.40
+9.9%
11.6%AU$18.50AU$12.20AU$18.637
Sep ’23AU$15.55
AU$15.40
-0.9%
11.6%AU$18.50AU$12.20AU$20.267
Aug ’23AU$15.24
AU$17.58
+15.3%
14.6%AU$23.00AU$14.35AU$19.307
Jul ’23AU$13.94
AU$18.08
+29.7%
14.2%AU$23.00AU$14.35AU$18.577
Jun ’23AU$16.15
AU$18.54
+14.8%
11.3%AU$23.00AU$16.10AU$18.207
May ’23AU$17.51
AU$18.54
+5.9%
11.3%AU$23.00AU$16.10AU$18.467
Apr ’23AU$18.27
AU$18.80
+2.9%
11.5%AU$23.00AU$16.10AU$17.357
Mar ’23AU$20.19
AU$18.97
-6.0%
10.7%AU$23.00AU$16.10AU$16.317

Analyst Forecast: Target price is lower than the current share price.


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