Coles Group Valuation

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

Below Fair Value: COL (A$18.15) is trading below our estimate of fair value (A$20.46)

Significantly Below Fair Value: COL is trading below fair value, but not by a significant amount.

Key Valuation Metric

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

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

The above table shows the Price to Earnings ratio for COL. This is calculated by dividing COL's market cap by their current earnings.
What is COL's PE Ratio?
PE Ratio	21.5x
Earnings	AU$1.13b
Market Cap	AU$24.26b

COL 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/Revenue	0.8x
Enterprise Value/EBITDA	13.1x
PEG Ratio	3.8x

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for COL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	22.4x
EDV Endeavour Group	15x	3.3%	AU$7.8b
MTS Metcash	13.2x	7.5%	AU$3.4b
SFM Sprouts Farmers Market	40.7x	11.7%	US$14.3b
MRU Metro	20.8x	3.4%	CA$19.2b
COL Coles Group	21.5x	5.6%	AU$24.3b

Price-To-Earnings vs Peers: COL is good value based on its Price-To-Earnings Ratio (21.5x) compared to the peer average (22.5x).

Price to Earnings Ratio vs Industry

How does COL's PE Ratio compare vs other companies in the Global Consumer Retailing Industry?

8 Companies	Price / Earnings	Estimated Growth	Market Cap

8 Companies		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: COL is expensive based on its Price-To-Earnings Ratio (21.5x) compared to the Global Consumer Retailing industry average (16.1x).

Price to Earnings Ratio vs Fair Ratio

What is COL'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.

COL PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	21.5x
Fair PE Ratio	21.2x

Price-To-Earnings vs Fair Ratio: COL is expensive based on its Price-To-Earnings Ratio (21.5x) compared to the estimated Fair Price-To-Earnings Ratio (21.2x).

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 COL forecast and predictions for the stock price in 12 month’s time.
Date	Share Price	Average 1Y Price Target	Dispersion	High	Low	1Y Actual price	Analysts
Current	AU$18.15	AU$18.64 +2.7%	8.1%	AU$21.00	AU$15.50	n/a	15
Nov ’25	AU$17.60	AU$18.68 +6.1%	8.2%	AU$21.00	AU$15.50	n/a	15
Oct ’25	AU$18.15	AU$19.00 +4.7%	8.6%	AU$21.55	AU$15.50	n/a	15
Sep ’25	AU$18.74	AU$18.85 +0.6%	8.5%	AU$21.00	AU$15.50	n/a	15
Aug ’25	AU$18.24	AU$17.84 -2.2%	7.2%	AU$19.50	AU$15.00	n/a	15
Jul ’25	AU$17.00	AU$17.36 +2.1%	6.4%	AU$19.00	AU$15.00	n/a	15
Jun ’25	AU$16.30	AU$17.23 +5.7%	6.5%	AU$19.00	AU$15.00	n/a	15
May ’25	AU$16.42	AU$17.17 +4.5%	7.0%	AU$19.00	AU$15.00	n/a	15
Apr ’25	AU$16.98	AU$17.08 +0.6%	6.5%	AU$19.00	AU$15.00	n/a	15
Mar ’25	AU$17.07	AU$17.10 +0.2%	6.5%	AU$19.00	AU$15.00	n/a	15
Feb ’25	AU$15.82	AU$16.22 +2.6%	7.9%	AU$18.10	AU$14.00	n/a	14
Jan ’25	AU$16.08	AU$16.13 +0.3%	7.0%	AU$18.10	AU$14.50	n/a	14
Dec ’24	AU$15.17	AU$16.00 +5.5%	7.3%	AU$18.10	AU$14.50	n/a	14
Nov ’24	AU$15.28	AU$16.11 +5.4%	7.5%	AU$18.10	AU$14.50	AU$17.60	15
Oct ’24	AU$15.62	AU$16.59 +6.2%	7.9%	AU$18.30	AU$14.50	AU$18.15	15
Sep ’24	AU$15.99	AU$16.91 +5.8%	8.8%	AU$19.92	AU$14.50	AU$18.74	16
Aug ’24	AU$18.31	AU$18.68 +2.0%	11.6%	AU$21.50	AU$14.00	AU$18.24	16
Jul ’24	AU$18.41	AU$18.57 +0.9%	12.7%	AU$21.50	AU$14.00	AU$17.00	16
Jun ’24	AU$18.12	AU$18.52 +2.2%	12.8%	AU$21.50	AU$14.00	AU$16.30	16
May ’24	AU$18.29	AU$18.54 +1.4%	12.5%	AU$21.50	AU$14.00	AU$16.42	16
Apr ’24	AU$18.06	AU$18.27 +1.2%	12.6%	AU$21.50	AU$14.00	AU$16.98	16
Mar ’24	AU$17.98	AU$18.26 +1.6%	12.7%	AU$21.50	AU$14.00	AU$17.07	16
Feb ’24	AU$17.93	AU$17.17 -4.2%	11.4%	AU$19.50	AU$13.60	AU$15.82	16
Jan ’24	AU$16.79	AU$17.09 +1.8%	11.1%	AU$19.50	AU$13.60	AU$16.08	16
Dec ’23	AU$16.78	AU$17.09 +1.8%	11.1%	AU$19.50	AU$13.60	AU$15.17	16
Nov ’23	AU$16.39	AU$17.38 +6.0%	10.5%	AU$20.50	AU$13.60	AU$15.28	15

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