What Does the Share Price Slump Mean for PLDT’s True Value in 2025?

If you’re looking at PLDT and wondering whether now is the time to buy, hold, or pass, you’re in good company. With its stock closing at 1,089.0 and down 16.1% year-to-date, it’s easy to see why investors are paying close attention. The past year hasn’t been gentle, with shares falling 21.8% in the last 12 months. Yet, over the last five years, PLDT has managed to eke out a respectable 15.6% total return, showing this blue-chip’s resilience even as the local market has faced turbulence.

Some of this volatility comes from larger trends in the telecom sector, shifting investor risk appetites, and an ongoing search for yield as global rates fluctuate. These pressures have caused many investors to re-evaluate how they price in future growth and risk. For long-term PLDT holders, it raises the question: is the market underappreciating this company’s prospects?

Here’s what stands out: by running PLDT through six different undervaluation checks, it passes every single one, turning up a value score of 6 out of 6. That kind of across-the-board undervaluation is rare among large cap companies and hints that there is more to PLDT than recent share price weakness would suggest.

Let’s dig into exactly which valuation tools back up this score. Further along, a closer look will provide an even sharper lens for sizing up PLDT’s real value right now.

Why PLDT is lagging behind its peers

Approach 1: PLDT Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow (DCF) model estimates a company's fair value by projecting its future cash flows and discounting them back to the present. This gives investors a sense of what those future earnings are worth today. The approach relies on both analyst forecasts for the next several years, followed by longer-term estimates beyond that point.

For PLDT, the most recent twelve months saw negative free cash flow of approximately ₱215.6 million. However, analysts expect a strong turnaround, predicting that free cash flow will reach ₱55.9 billion by 2026 and grow further to ₱63.6 billion by 2027. Looking out over the next decade, Simply Wall St extrapolates these forecasts and estimates free cash flow could approach ₱111.9 billion by 2035. All these projections are based on cash flows measured in Philippine Pesos (₱).

When these projected cash flows are discounted back to today, PLDT's estimated intrinsic value comes out to ₱4,768 per share according to the DCF model. With the current share price at ₱1,089, the implied discount is a striking 77.2%. This suggests the market may be drastically underestimating PLDT's long-term earning power.

Result: UNDERVALUED

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

Our Discounted Cash Flow (DCF) analysis suggests PLDT is undervalued by 77.2%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: PLDT Price vs Earnings

The Price-to-Earnings (PE) ratio is a longstanding favorite for valuing profitable companies like PLDT, as it directly relates share price to actual earnings. For established businesses with steady profits, the PE ratio offers a straightforward snapshot of how much the market is willing to pay for each peso of profit.

However, what counts as a “normal” PE ratio depends not just on industry norms, but also growth expectations and perceived risks. Fast-growing or less risky companies usually command higher PEs, while more uncertain prospects trade at lower levels. This context is key in determining whether PLDT is a bargain or not.

PLDT currently trades on a PE ratio of just 7.36x. To put that in context, its industry average sits at 18.37x, and peers average 15.11x, which is more than double PLDT’s valuation. Rather than rely solely on these comparisons, Simply Wall St’s proprietary “Fair Ratio” blends in additional factors such as the company’s expected earnings growth, market cap, profitability, and sector-specific trends. For PLDT, the calculated Fair Ratio is 8.05x.

The advantage of this Fair Ratio approach is that it adjusts for nuances that simple peer or industry comparisons might miss. This makes it a more tailored benchmark for valuation. Looking at the numbers, PLDT’s actual PE ratio of 7.36x is slightly below its Fair Ratio, but the difference—less than 0.10 in absolute terms—suggests the valuation is in line with fundamentals.

Result: ABOUT RIGHT

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

Upgrade Your Decision Making: Choose your PLDT Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is your own reasoned story about a company that connects your expectations, such as future revenue, earnings, and margins, to a fair value for its shares. In other words, Narratives help investors see beyond just numbers by pairing a company’s business outlook with a financial forecast and then translating that into a fair value estimate.

On Simply Wall St’s Community page, used by millions of investors, Narratives make this process simple and accessible to everyone. They let you create, adjust, and share your perspective on PLDT or any other stock, merging qualitative insights with quantitative models. The real power comes from how Narratives automatically update when new news or earnings come in, allowing your forecast and potential buy or sell decision to reflect the latest developments.

Suppose you are optimistic about PLDT’s digital expansion and fiber growth. You might build a Narrative with strong revenue forecasts and a fair value closer to the analysts’ high estimate of ₱2,070. Alternatively, if you are more cautious about risks such as competition or regulatory change, you might arrive at a conservative fair value near the lowest analyst target of ₱1,200. Narratives make it easy to compare your fair value to the current price at any time, supporting more informed investment decisions based on your personal view of PLDT’s story.

Do you think there's more to the story for PLDT? Create your own Narrative to let the Community know!

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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