Prudential plc

LSE:PRU Stock Report

Market Cap: UK£16.8b

Prudential Valuation

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

Valuation Score

3/6

Valuation Score 3/6

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

Below Fair Value: PRU (£6.35) is trading below our estimate of fair value (£15.54)

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

Key Valuation Metric

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

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

The above table shows the Price to Earnings ratio for PRU. This is calculated by dividing PRU's market cap by their current earnings.
What is PRU's PE Ratio?
PE Ratio24.4x
EarningsUS$877.00m
Market CapUS$21.29b

Price to Earnings Ratio vs Peers

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

The above table shows the PE ratio for PRU vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average37x
LGEN Legal & General Group
45.4x28.0%UK£12.7b
JUST Just Group
16.2x8.2%UK£1.4b
CSN Chesnara
76.3x11.8%UK£377.5m
AV. Aviva
10.1x4.2%UK£12.7b
PRU Prudential
24.4x28.4%UK£16.8b

Price-To-Earnings vs Peers: PRU is good value based on its Price-To-Earnings Ratio (24.4x) compared to the peer average (37x).

Price to Earnings Ratio vs Industry

How does PRU's PE Ratio compare vs other companies in the European Insurance Industry?

1 CompanyPrice / EarningsEstimated GrowthMarket Cap
PRU 24.4xIndustry Avg. 11.7xNo. of Companies12PE0816243240+
1 CompanyEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: PRU is expensive based on its Price-To-Earnings Ratio (24.4x) compared to the European Insurance industry average (11.7x).

Price to Earnings Ratio vs Fair Ratio

What is PRU'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.

PRU PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio24.4x
Fair PE Ratio16.9x

Price-To-Earnings vs Fair Ratio: PRU is expensive based on its Price-To-Earnings Ratio (24.4x) compared to the estimated Fair Price-To-Earnings Ratio (16.9x).

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 PRU forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUK£6.35
UK£11.60
+82.6%
17.5%UK£16.10UK£8.60n/a15
Nov ’25UK£6.44
UK£11.61
+80.3%
17.8%UK£16.10UK£8.65n/a15
Oct ’25UK£6.92
UK£11.54
+66.8%
17.9%UK£16.10UK£8.65n/a15
Sep ’25UK£6.52
UK£11.62
+78.2%
18.4%UK£16.10UK£8.65n/a15
Aug ’25UK£6.67
UK£12.06
+80.7%
16.4%UK£16.10UK£8.80n/a16
Jul ’25UK£7.14
UK£12.20
+70.8%
16.9%UK£16.10UK£8.90n/a16
Jun ’25UK£7.47
UK£12.34
+65.2%
16.9%UK£16.10UK£8.60n/a16
May ’25UK£7.05
UK£12.62
+78.9%
19.4%UK£17.50UK£8.30n/a16
Apr ’25UK£7.43
UK£12.98
+74.6%
21.2%UK£17.67UK£8.30n/a16
Mar ’25UK£7.82
UK£13.55
+73.1%
19.7%UK£18.00UK£9.00n/a18
Feb ’25UK£8.06
UK£13.59
+68.5%
20.2%UK£18.90UK£9.00n/a18
Jan ’25UK£8.87
UK£14.30
+61.2%
15.0%UK£18.90UK£11.30n/a18
Dec ’24UK£8.69
UK£14.30
+64.6%
15.0%UK£18.90UK£11.30n/a18
Nov ’24UK£8.58
UK£14.57
+69.8%
14.8%UK£19.50UK£11.30UK£6.4418
Oct ’24UK£8.89
UK£15.01
+68.9%
13.8%UK£19.55UK£11.30UK£6.9218
Sep ’24UK£9.70
UK£15.21
+56.8%
13.2%UK£19.55UK£10.80UK£6.5219
Aug ’24UK£10.60
UK£15.46
+45.9%
13.6%UK£19.55UK£10.20UK£6.6719
Jul ’24UK£11.09
UK£15.79
+42.5%
13.4%UK£20.20UK£10.20UK£7.1419
Jun ’24UK£10.91
UK£15.72
+44.1%
12.8%UK£19.00UK£10.10UK£7.4719
May ’24UK£12.12
UK£15.71
+29.6%
12.9%UK£19.00UK£10.10UK£7.0519
Apr ’24UK£11.02
UK£15.61
+41.6%
13.1%UK£19.00UK£10.20UK£7.4319
Mar ’24UK£12.94
UK£15.71
+21.4%
12.6%UK£19.00UK£10.20UK£7.8219
Feb ’24UK£13.46
UK£15.26
+13.4%
13.7%UK£19.00UK£10.20UK£8.0619
Jan ’24UK£11.28
UK£14.15
+25.5%
11.7%UK£16.70UK£11.00UK£8.8719
Dec ’23UK£10.16
UK£14.39
+41.7%
11.2%UK£16.70UK£11.00UK£8.6918
Nov ’23UK£8.44
UK£14.52
+72.1%
10.5%UK£16.70UK£11.00UK£8.5818

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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