Plejd (NGM:PLEJD): Evaluating Valuation Following Strong Q3 Earnings and Upgraded Growth Outlook

Plejd (NGM:PLEJD) has just released its third quarter 2025 earnings, posting sharp gains in both sales and net income compared to the same period last year. The results are catching investor attention.

See our latest analysis for Plejd.

Plejd’s sustained earnings momentum appears to be fueling fresh optimism, with the share price returning 76% year-to-date and surging 43% over the last 90 days alone. This enthusiasm is building on three- and five-year total shareholder returns of 150% and 791% respectively, underlining a powerful multi-year growth story.

If this sharp run has you looking for other high-momentum names, now could be the perfect time to broaden your search and discover fast growing stocks with high insider ownership

Yet with Plejd’s shares trading near all-time highs, and the current price sitting above analyst targets, investors may now wonder if the stock offers more upside or if the market has already priced in its future growth prospects.

Price-to-Earnings of 58.8x: Is it justified?

Plejd’s shares are trading at a price-to-earnings (P/E) ratio of 58.8x, significantly higher than both its industry and peer averages. This suggests investors are paying a premium for its earnings growth. The last close price of SEK668 is well above the European electrical industry’s average pricing for similar earnings profiles.

The price-to-earnings ratio measures how much investors are willing to pay for each unit of the company's profit. It is especially relevant for companies like Plejd in growth sectors, as it can signal high expectations for future earnings or reflect a growth premium.

A P/E of 58.8x is more than triple the European electrical industry average of 18x. This indicates the market is pricing in strong future earnings growth and may be factoring in Plejd’s proven ability to expand profits rapidly, high return on equity, and recent momentum. Compared to the estimated fair P/E of 28x, the current level appears elevated. This suggests room for mean reversion could exist if growth expectations moderate.

Explore the SWS fair ratio for Plejd

Result: Price-to-Earnings of 58.8x (OVERVALUED)

However, with shares exceeding analyst targets and valuation stretched, any slowdown in revenue or profit growth could trigger a sharp pullback in sentiment.

Find out about the key risks to this Plejd narrative.

Another View: What Does the Discounted Cash Flow Show?

While a high price-to-earnings ratio makes Plejd look expensive, our SWS DCF model provides a different angle. This method values Plejd at SEK513.35 per share, which is below today’s market price of SEK668. Could the current enthusiasm be running ahead of long-term fundamentals?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Plejd for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Plejd Narrative

If you see things differently or want to dig into the numbers yourself, it only takes a few minutes to build your own perspective, your way. Do it your way

A great starting point for your Plejd research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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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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