Grafton Group Valuation

Q: What is the Fair Price of GFTU when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

GFTU (£10.8) is trading below our estimate of [[fair value]] (£14.41)

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

Below Fair Value: GFTU (£10.8) is trading below our estimate of fair value (£14.41)

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

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GFTU. This is calculated by dividing GFTU's market cap by their current preferred multiple.
What is GFTU's n/a Ratio?
n/a	0x
n/a	n/a
Market Cap	UK£2.16b

GFTU 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	1x
Enterprise Value/EBITDA	11.5x
PEG Ratio	2.8x

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for GFTU 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	28.7x
RS1 RS Group	20.2x	12.6%	UK£3.7b
HWDN Howden Joinery Group	21.1x	8.7%	UK£5.4b
DPLM Diploma	53.5x	16.7%	UK£6.2b
AT. Ashtead Technology Holdings	19.8x	14.1%	UK£485.0m
GFTU Grafton Group	16.4x	5.8%	UK£2.2b

Price-To-Earnings vs Peers: GFTU is good value based on its Price-To-Earnings Ratio (16.4x) compared to the peer average (28.7x).

Price to Earnings Ratio vs Industry

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

0 Companies	Price / Earnings	Estimated Growth	Market Cap
Industry Avg.	n/a	9.4%
	n/a	n/a	n/a

Fetching data

0 Companies	Price / Earnings	Estimated Growth	Market Cap
Industry Avg.	n/a	9.4%
	n/a	n/a	n/a

No more companies

Price-To-Earnings vs Industry: GFTU is expensive based on its Price-To-Earnings Ratio (16.4x) compared to the European Trade Distributors industry average (15.2x).

Price to Earnings Ratio vs Fair Ratio

What is GFTU'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.

GFTU PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	16.4x
Fair PE Ratio	18.3x

Price-To-Earnings vs Fair Ratio: GFTU is good value based on its Price-To-Earnings Ratio (16.4x) compared to the estimated Fair Price-To-Earnings Ratio (18.3x).

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 GFTU 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	UK£10.80	UK£11.80 +9.3%	2.8%	UK£12.30	UK£11.15	n/a	9
Sep ’25	UK£10.79	UK£11.73 +8.7%	2.9%	UK£12.30	UK£11.15	n/a	9
Aug ’25	UK£10.60	UK£11.35 +7.0%	5.7%	UK£12.30	UK£9.95	n/a	9
Jul ’25	UK£9.24	UK£11.35 +22.8%	5.7%	UK£12.30	UK£9.95	n/a	9
Jun ’25	UK£9.93	UK£11.53 +16.1%	6.5%	UK£12.95	UK£10.10	n/a	10
May ’25	UK£9.38	UK£11.51 +22.6%	6.2%	UK£12.95	UK£10.10	n/a	10
Apr ’25	UK£10.02	UK£11.53 +15.0%	5.9%	UK£12.95	UK£10.30	n/a	10
Mar ’25	UK£9.83	UK£10.64 +8.2%	9.6%	UK£12.95	UK£9.40	n/a	10
Feb ’25	UK£9.72	UK£10.56 +8.6%	9.9%	UK£12.95	UK£9.40	n/a	9
Jan ’25	UK£9.11	UK£10.22 +12.2%	12.7%	UK£12.95	UK£8.15	n/a	9
Dec ’24	UK£8.21	UK£10.22 +24.6%	12.7%	UK£12.95	UK£8.15	n/a	9
Nov ’24	UK£7.73	UK£10.61 +37.2%	12.9%	UK£13.00	UK£8.20	n/a	7
Oct ’24	UK£9.04	UK£10.79 +19.4%	10.4%	UK£13.00	UK£9.10	n/a	7
Sep ’24	UK£8.66	UK£10.78 +24.5%	10.5%	UK£13.00	UK£9.10	UK£10.79	7
Aug ’24	UK£8.74	UK£10.69 +22.3%	11.6%	UK£13.00	UK£8.55	UK£10.60	7
Jul ’24	UK£7.82	UK£10.81 +38.3%	9.7%	UK£13.00	UK£9.45	UK£9.24	7
Jun ’24	UK£8.25	UK£10.81 +31.1%	9.7%	UK£13.00	UK£9.45	UK£9.93	7
May ’24	UK£8.67	UK£10.94 +26.3%	8.5%	UK£13.00	UK£9.90	UK£9.38	8
Apr ’24	UK£8.86	UK£10.94 +23.6%	8.5%	UK£13.00	UK£9.90	UK£10.02	8
Mar ’24	UK£9.35	UK£10.69 +14.3%	11.1%	UK£13.00	UK£9.25	UK£9.83	8
Feb ’24	UK£9.44	UK£10.69 +13.3%	11.1%	UK£13.00	UK£9.25	UK£9.72	8
Jan ’24	UK£7.89	UK£10.69 +35.6%	11.1%	UK£13.00	UK£9.25	UK£9.11	8
Dec ’23	UK£7.94	UK£10.69 +34.7%	11.1%	UK£13.00	UK£9.25	UK£8.21	8
Nov ’23	UK£7.02	UK£10.77 +53.5%	9.6%	UK£12.80	UK£9.30	UK£7.73	7
Oct ’23	UK£6.72	UK£11.29 +68.1%	23.2%	UK£17.00	UK£7.40	UK£9.04	8
Sep ’23	UK£7.04	UK£12.20 +73.3%	24.6%	UK£17.00	UK£7.40	UK£8.66	8

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