A Fresh Look at Amrize (SWX:AMRZ) Valuation Following a Recent Rebound in Share Price

Amrize (SWX:AMRZ) has been on the radar as investors take stock of its recent performance. Over the past month, shares have gained 6%, even as there has been some volatility in the last quarter.

See our latest analysis for Amrize.

Amrize’s 6.4% 1-month share price return stands out, especially after the dip earlier in the quarter. While momentum has picked up lately, the stock’s year-to-date share price return remains negative. Broader context and valuation are crucial for investors.

If you’re searching for more opportunities beyond Amrize’s recent rebound, now is a great time to broaden your search and discover fast growing stocks with high insider ownership

With an analyst target 16% above current levels and some signs of improving financials, the real question is whether Amrize is genuinely undervalued right now or if market expectations already reflect future growth prospects.

Price-to-Earnings of 23.5x: Is it justified?

Amrize currently trades at a price-to-earnings (P/E) ratio of 23.5x, notably higher than key market benchmarks. With a last close price of CHF40, this figure signals that investors may be paying a premium compared to sector peers.

The P/E ratio reflects how much investors are willing to pay for every unit of earnings. In the basic materials sector, it often hints at expectations for future profitability, growth, or perceived risk. For Amrize, a 23.5x ratio means the stock is priced for stronger future performance. However, it also raises the barrier for upside surprises.

Crucially, Amrize’s current P/E stands well above both the European Basic Materials industry average of 15x and the peer group average of 22.7x. This premium suggests that either the market is optimistic about Amrize’s earnings growth or is overestimating its prospects compared to similar companies. If the fair ratio becomes the anchor for market valuations, there could be a significant shift in price expectations.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-Earnings of 23.5x (OVERVALUED)

However, lackluster year-to-date performance and the relatively high valuation could leave Amrize vulnerable if earnings growth does not exceed expectations.

Find out about the key risks to this Amrize narrative.

Another View: Deep Discount to Fair Value?

While Amrize appears overvalued on a price-to-earnings basis, our DCF model tells a different story. Based on SWS DCF analysis, Amrize is trading at nearly a 48% discount to its estimated fair value. Such a gap suggests missed upside, or is the market right to be cautious?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Amrize for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Amrize Narrative

If you have a different perspective from this analysis or prefer digging into the numbers yourself, it’s quick and easy to shape your own viewpoint in just minutes. Do it your way

A great starting point for your Amrize research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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