Pepper Money Limited

CHIA:PPM Stock Report

Market Cap: AU$576.5m

Pepper Money Valuation

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

Valuation Score

6/6

Valuation Score 6/6

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

Below Fair Value: PPM (A$1.32) is trading below our estimate of fair value (A$4.46)

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

Key Valuation Metric

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

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

The above table shows the Price to Earnings ratio for PPM. This is calculated by dividing PPM's market cap by their current earnings.
What is PPM's PE Ratio?
PE Ratio5.5x
EarningsAU$104.40m
Market CapAU$576.55m

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for PPM vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average9.5x
LFG Liberty Financial Group
8.6x10.3%AU$996.5m
AFG Australian Finance Group
14.1xn/aAU$408.9m
RMC Resimac Group
10x22.7%AU$346.0m
HLI Helia Group
5.4x-34.1%AU$1.2b
PPM Pepper Money
5.5x9.4%AU$576.5m

Price-To-Earnings vs Peers: PPM is good value based on its Price-To-Earnings Ratio (5.5x) compared to the peer average (9.5x).

Price to Earnings Ratio vs Industry

How does PPM's PE Ratio compare vs other companies in the Oceanian Diversified Financial Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
PPM 5.5xIndustry Avg. 15.8xNo. of Companies5PE0816243240+
0 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: PPM is good value based on its Price-To-Earnings Ratio (5.5x) compared to the Global Diversified Financial industry average (15.7x).

Price to Earnings Ratio vs Fair Ratio

What is PPM'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.

PPM PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio5.5x
Fair PE Ratio15.6x

Price-To-Earnings vs Fair Ratio: PPM is good value based on its Price-To-Earnings Ratio (5.5x) compared to the estimated Fair Price-To-Earnings Ratio (15.6x).

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 PPM forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentAU$1.32
AU$1.59
+20.7%
3.7%AU$1.70AU$1.55n/a5
Nov ’25AU$1.44
AU$1.59
+10.4%
3.7%AU$1.70AU$1.55n/a5
Oct ’25AU$1.38
AU$1.59
+15.2%
3.7%AU$1.70AU$1.55n/a5
Sep ’25AU$1.38
AU$1.59
+15.2%
3.7%AU$1.70AU$1.55n/a5
Aug ’25AU$1.47
AU$1.63
+11.3%
5.7%AU$1.80AU$1.55n/a5
Jul ’25AU$1.46
AU$1.64
+13.0%
5.3%AU$1.80AU$1.55n/a5
Jun ’25AU$1.46
AU$1.66
+14.0%
5.2%AU$1.80AU$1.55n/a5
May ’25AU$1.46
AU$1.65
+13.3%
5.3%AU$1.80AU$1.55n/a5
Apr ’25AU$1.63
AU$1.65
+1.8%
5.3%AU$1.80AU$1.55n/a5
Mar ’25AU$1.63
AU$1.65
+1.5%
5.3%AU$1.80AU$1.55n/a5
Feb ’25AU$1.38
AU$1.45
+5.1%
4.0%AU$1.50AU$1.35n/a6
Jan ’25AU$1.25
AU$1.47
+18.1%
5.3%AU$1.57AU$1.35n/a6
Dec ’24AU$1.17
AU$1.57
+34.5%
14.5%AU$2.10AU$1.35n/a7
Nov ’24AU$1.25
AU$1.73
+39.1%
27.9%AU$2.88AU$1.35AU$1.448
Oct ’24AU$1.30
AU$1.73
+33.2%
27.9%AU$2.88AU$1.35AU$1.388
Sep ’24AU$1.38
AU$1.73
+25.9%
27.9%AU$2.88AU$1.35AU$1.388
Aug ’24AU$1.49
AU$1.90
+27.2%
21.5%AU$2.88AU$1.50AU$1.478
Jul ’24AU$1.41
AU$1.93
+37.7%
19.7%AU$2.88AU$1.50AU$1.469
Jun ’24AU$1.28
AU$1.89
+48.2%
21.4%AU$2.88AU$1.50AU$1.469
May ’24AU$1.34
AU$1.89
+41.0%
21.4%AU$2.88AU$1.50AU$1.469
Apr ’24AU$1.33
AU$1.95
+47.1%
28.2%AU$3.39AU$1.50AU$1.639
Mar ’24AU$1.46
AU$1.95
+33.5%
28.2%AU$3.39AU$1.50AU$1.639
Feb ’24AU$1.59
AU$2.16
+36.0%
25.6%AU$3.39AU$1.55AU$1.388
Jan ’24AU$1.43
AU$2.16
+51.8%
25.6%AU$3.39AU$1.55AU$1.258
Dec ’23AU$1.47
AU$2.16
+47.1%
25.6%AU$3.39AU$1.55AU$1.178
Nov ’23AU$1.48
AU$2.16
+46.1%
25.6%AU$3.39AU$1.55AU$1.258

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

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