Does the 43% Drop Make Wolters Kluwer a Hidden Opportunity in 2025?

• Ever wondered if Wolters Kluwer is actually a bargain or simply riding out the market’s ups and downs? This article is for you if you think there could be more value hiding in plain sight.
• Wolters Kluwer’s stock has seen a sharp reversal in the past year, sliding by 39.3% and falling 43.0% year-to-date. This movement has caught the market’s attention and hints at changing expectations.
• A recent wave of sector-wide volatility and global market jitters has driven notable moves across similar companies. Headlines have focused on shifting economic conditions and regulatory updates impacting professional services firms like Wolters Kluwer. Inflation concerns and market-wide shifts in tech adoption have added further context to the stock's recent pricing swings.
• All of this makes Wolters Kluwer’s impressive 6 out of 6 valuation score even more interesting as we break down how value is calculated. At the end, we share what may be a smarter approach to understanding if it is truly undervalued.

Find out why Wolters Kluwer's -39.3% return over the last year is lagging behind its peers.

Approach 1: Wolters Kluwer Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates what a company is worth by projecting its future cash flows and discounting them back to today’s value. This approach helps investors understand whether a stock’s price reflects its potential to generate cash in the future.

For Wolters Kluwer, the most recent reported Free Cash Flow is €1.37 billion. Analysts forecast steady growth, projecting Free Cash Flow to reach around €1.71 billion by 2029. After 2029, these cash flow projections are extended by Simply Wall St’s models to cover a ten-year outlook, reflecting expectations that future growth will gradually slow. All cash flows are presented in euros, in line with the company's reporting currency.

Based on these calculations, Wolters Kluwer’s estimated intrinsic value per share is €192.97. Comparing this to the current share price, the DCF methodology indicates that the stock is trading at a 52.4% discount. This suggests it is substantially undervalued in the market right now.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Wolters Kluwer is undervalued by 52.4%. Track this in your watchlist or portfolio, or discover 894 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Wolters Kluwer.

Approach 2: Wolters Kluwer Price vs Earnings

For profitable companies like Wolters Kluwer, the Price-to-Earnings (PE) ratio is a widely recognized way to assess valuation. It essentially tells investors how much they are paying for each euro of earnings, helping to compare companies regardless of their size.

The "right" PE ratio for a stock depends on factors such as expected earnings growth and risk. Companies with strong growth potential or lower risk usually command higher PE ratios, while those with slower growth or greater uncertainty often trade at lower multiples.

Wolters Kluwer currently trades at a PE ratio of 18.6x. This is slightly above the Professional Services industry average of 18.4x and notably below the peer group average of 45.6x. At first glance, this could suggest that the market is pricing Wolters Kluwer in line with its sector, but well below its closest peers.

Simply Wall St’s proprietary Fair Ratio for Wolters Kluwer is 20.3x. This Fair Ratio takes a much deeper look than basic industry or peer comparisons. It considers Wolters Kluwer’s specific earnings growth projections, profit margins, industry context, market capitalization, and risk profile. As a result, it provides a more tailored benchmark for what the “right” PE ratio should be for this company right now.

Comparing the Fair Ratio (20.3x) to Wolters Kluwer's current PE (18.6x), the stock trades at a slight discount to its own fundamentals-based fair value. This suggests Wolters Kluwer may be modestly undervalued on this metric.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1417 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Wolters Kluwer Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. A Narrative is simply the story or perspective you have about a company. It connects the company’s business context, your own assumptions about future growth, and what you believe is a fair value.

With Narratives, you build a clear logic from story to numbers, anchoring your expectations about Wolters Kluwer's revenue, earnings, or margins and seeing how these translate into an updated fair value estimate. This approach, available to everyone in the Simply Wall St Community, makes it easy to compare your outlook against the consensus view or other investors’ perspectives on the Community page.

Narratives help everyday investors make more confident buy or sell decisions by showing exactly how the current share price compares to your own or the market’s fair value. They update in real time as news or earnings emerge, so your decisions stay powered by the most relevant information.

For example, some investors are convinced that Wolters Kluwer’s leadership in cloud-based SaaS and AI-powered tools will drive strong recurring revenue, leading them to set a fair value as high as €175.0 per share. Others see risks in print revenue decline or market competition, supporting a much more conservative outlook and a fair value near €117.0 per share. With Narratives, you can pick or build a perspective that matches your beliefs and risk appetite.

Do you think there's more to the story for Wolters Kluwer? Head over to our Community to see what others are saying!

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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