United Utilities Group PLC

LSE:UU. Stock Report

Market Cap: UK£7.1b

United Utilities Group Valuation

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

Valuation Score

1/6

Valuation Score 1/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

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

Below Fair Value: UU. (£10.47) is trading above our estimate of fair value (£7.7)

Significantly Below Fair Value: UU. is trading above our estimate of fair value.

Key Valuation Metric

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

Other financial metrics that can be useful for relative valuation.

UU. 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/Revenue8.2x
Enterprise Value/EBITDA18x
PEG Ration/a

Price to Sales Ratio vs Peers

How does UU.'s PS Ratio compare to its peers?

The above table shows the PS ratio for UU. vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PSEstimated GrowthMarket Cap
Peer Average1.9x
SVT Severn Trent
3.3x6.7%UK£7.4b
PNN Pennon Group
2.3x8.9%UK£1.9b
CNA Centrica
0.3x-10.8%UK£7.0b
SSE SSE
1.6x-0.5%UK£18.1b
UU. United Utilities Group
3.8x7.3%UK£7.1b

Price-To-Sales vs Peers: UU. is expensive based on its Price-To-Sales Ratio (3.8x) compared to the peer average (1.9x).

Price to Earnings Ratio vs Industry

How does UU.'s PE Ratio compare vs other companies in the Global Water Utilities Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a14.7%
 n/an/an/a
No. of CompaniesPS048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a14.7%
 n/an/an/a
No more companies

Price-To-Sales vs Industry: UU. is expensive based on its Price-To-Sales Ratio (3.8x) compared to the Global Water Utilities industry average (2x).

Price to Sales Ratio vs Fair Ratio

What is UU.'s PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

UU. PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio3.8x
Fair PS Ratio5.5x

Price-To-Sales vs Fair Ratio: UU. is good value based on its Price-To-Sales Ratio (3.8x) compared to the estimated Fair Price-To-Sales Ratio (5.5x).

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 UU. forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUK£10.43
UK£11.28
+8.2%
10.4%UK£13.15UK£9.48n/a13
Apr ’25UK£10.29
UK£11.23
+9.2%
9.5%UK£13.15UK£9.48n/a13
Mar ’25UK£10.18
UK£11.23
+10.4%
9.5%UK£13.15UK£9.48n/a13
Feb ’25UK£10.63
UK£11.26
+6.0%
9.5%UK£13.15UK£9.48n/a13
Jan ’25UK£10.60
UK£11.11
+4.9%
10.1%UK£12.90UK£9.18n/a13
Dec ’24UK£10.92
UK£11.04
+1.1%
10.5%UK£12.90UK£9.18n/a12
Nov ’24UK£10.88
UK£11.16
+2.6%
11.3%UK£13.20UK£9.18n/a13
Oct ’24UK£9.48
UK£11.09
+16.9%
10.7%UK£12.90UK£9.18n/a12
Sep ’24UK£9.32
UK£11.00
+18.0%
11.1%UK£13.10UK£9.47n/a12
Aug ’24UK£9.95
UK£11.02
+10.7%
11.1%UK£13.10UK£9.47n/a12
Jul ’24UK£9.62
UK£11.06
+15.1%
11.3%UK£13.40UK£9.60n/a12
Jun ’24UK£10.32
UK£10.81
+4.7%
12.5%UK£13.40UK£8.50n/a11
May ’24UK£10.82
UK£10.88
+0.5%
12.7%UK£13.40UK£8.50n/a12
Apr ’24UK£10.60
UK£10.65
+0.4%
13.4%UK£13.40UK£8.50UK£10.2911
Mar ’24UK£9.91
UK£10.77
+8.6%
13.3%UK£13.40UK£8.50UK£10.1812
Feb ’24UK£10.52
UK£10.71
+1.8%
13.5%UK£13.40UK£8.50UK£10.6312
Jan ’24UK£9.91
UK£10.56
+6.5%
12.3%UK£12.90UK£8.50UK£10.6012
Dec ’23UK£10.46
UK£10.41
-0.4%
11.5%UK£12.90UK£8.50UK£10.9212
Nov ’23UK£9.45
UK£10.57
+11.9%
11.5%UK£12.90UK£8.50UK£10.8813
Oct ’23UK£8.89
UK£10.89
+22.5%
10.4%UK£12.90UK£8.50UK£9.4812
Sep ’23UK£10.50
UK£11.02
+4.9%
11.9%UK£12.90UK£7.90UK£9.3213
Aug ’23UK£10.97
UK£10.94
-0.3%
11.9%UK£12.90UK£7.90UK£9.9513
Jul ’23UK£10.21
UK£10.94
+7.2%
11.9%UK£12.90UK£7.90UK£9.6213
Jun ’23UK£10.40
UK£10.81
+3.9%
11.1%UK£13.50UK£7.90UK£10.3212
May ’23UK£11.51
UK£10.96
-4.8%
12.1%UK£13.50UK£7.90UK£10.8213
Apr ’23UK£11.22
UK£10.81
-3.7%
12.1%UK£13.50UK£7.90UK£10.6013

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

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