Associated British Foods plc

DB:AFO1 Stock Report

Market Cap: €19.4b

Associated British Foods Valuation

Is AFO1 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • 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 AFO1 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: AFO1 (€26.67) is trading below our estimate of fair value (€35.61)

Significantly Below Fair Value: AFO1 is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for AFO1?

Key metric: As AFO1 is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for AFO1. This is calculated by dividing AFO1's market cap by their current earnings.
What is AFO1's PE Ratio?
PE Ratio11.1x
EarningsUK£1.46b
Market CapUK£16.22b

Price to Earnings Ratio vs Peers

How does AFO1's PE Ratio compare to its peers?

The above table shows the PE ratio for AFO1 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average11.1x
SZU Südzucker
6.8x-10.2%€2.3b
SSH Südwestdeutsche Salzwerke
15.3xn/a€630.5m
NLM FRoSTA
12.2xn/a€415.6m
KWS KWS SAAT SE KGaA
10x-1.0%€2.0b
AFO1 Associated British Foods
11.1x4.2%€16.2b

Price-To-Earnings vs Peers: AFO1 is expensive based on its Price-To-Earnings Ratio (11.1x) compared to the peer average (11.1x).

Price to Earnings Ratio vs Industry

How does AFO1's PE Ratio compare vs other companies in the European Food Industry?

3 CompaniesPrice / EarningsEstimated GrowthMarket Cap
AFO1 11.1xIndustry Avg. 13.5xNo. of Companies18PE0816243240+
3 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: AFO1 is good value based on its Price-To-Earnings Ratio (11.1x) compared to the European Food industry average (13.4x).

Price to Earnings Ratio vs Fair Ratio

What is AFO1'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.

AFO1 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio11.1x
Fair PE Ratio20.9x

Price-To-Earnings vs Fair Ratio: AFO1 is good value based on its Price-To-Earnings Ratio (11.1x) compared to the estimated Fair Price-To-Earnings Ratio (20.9x).

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 AFO1 forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
Current€26.67
€31.01
+16.3%
11.8%€37.44€23.75n/a17
Nov ’25€26.52
€30.81
+16.2%
12.0%€37.26€23.63n/a17
Oct ’25€27.90
€30.47
+9.2%
11.9%€37.04€23.50n/a18
Sep ’25€29.54
€31.62
+7.1%
12.6%€40.32€23.47n/a18
Aug ’25€29.10
€31.98
+9.9%
12.3%€40.48€23.56n/a18
Jul ’25€29.15
€31.74
+8.9%
12.3%€40.17€23.38n/a18
Jun ’25€30.47
€31.27
+2.6%
12.2%€39.63€23.07n/a18
May ’25€30.63
€30.77
+0.5%
13.3%€39.73€23.13n/a18
Apr ’25€29.25
€28.70
-1.9%
13.4%€37.47€23.17n/a19
Mar ’25€26.45
€28.75
+8.7%
13.1%€37.46€23.16n/a20
Feb ’25€27.15
€28.66
+5.6%
13.3%€37.55€23.23n/a20
Jan ’25€27.15
€27.53
+1.4%
13.5%€36.03€20.34n/a20
Dec ’24€27.40
€27.13
-1.0%
13.0%€34.47€20.10n/a20
Nov ’24€23.15
€26.06
+12.6%
10.2%€32.33€20.20€26.5220
Oct ’24€23.60
€26.11
+10.6%
10.3%€32.41€20.26€27.9020
Sep ’24€23.10
€25.25
+9.3%
11.4%€29.19€18.68€29.5420
Aug ’24€23.70
€25.00
+5.5%
11.6%€28.97€18.54€29.1020
Jul ’24€22.80
€24.99
+9.6%
11.4%€29.02€18.57€29.1520
Jun ’24€21.30
€24.11
+13.2%
12.3%€29.08€16.67€30.4718
May ’24€21.85
€23.66
+8.3%
12.2%€28.61€16.39€30.6318
Apr ’24€22.20
€23.72
+6.8%
12.5%€28.79€16.50€29.2518
Mar ’24€23.00
€23.39
+1.7%
13.2%€28.52€16.34€26.4517
Feb ’24€21.20
€21.24
+0.2%
16.6%€27.67€13.33€27.1517
Jan ’24€18.00
€18.91
+5.1%
15.2%€25.21€13.47€27.1518
Dec ’23€18.60
€19.09
+2.6%
15.6%€25.59€13.67€27.4018
Nov ’23€16.30
€18.79
+15.3%
19.1%€26.71€12.77€23.1518

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

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