Assessing Sectra (OM:SECT B)’s Valuation After Recent Share Price Pullback

Sectra (OM:SECT B) has pulled back again, with the stock down about 7% over the past month and roughly 16% in the past 3 months, despite solid double digit revenue and earnings growth.

See our latest analysis for Sectra.

That pullback comes after a strong multi year run, with the share price still nearly doubling over five years and delivering a 3 year total shareholder return of about 59 percent. This suggests momentum has cooled even as the growth story remains intact.

If Sectra’s volatility has you rethinking sector exposure, this could be a good moment to explore other specialised healthcare names via our curated healthcare stocks.

With shares sliding even as revenues and profits climb at a healthy double digit pace, investors now face a key question: is Sectra quietly slipping into undervalued territory, or is the market already baking in years of future growth?

Most Popular Narrative: 32.3% Overvalued

With Sectra last closing at SEK 274.60 against a narrative fair value of SEK 207.50, the prevailing view is that enthusiasm still runs ahead of fundamentals.

The analysts have a consensus price target of SEK300.0 for Sectra based on their expectations of its future earnings growth, profit margins and other risk factors.

In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be SEK5.2 billion, earnings will come to SEK918.0 million, and it would be trading on a PE ratio of 74.4x, assuming you use a discount rate of 5.9%.

Read the complete narrative.

Want to see the full logic behind this rich valuation? The narrative leans on ambitious growth, stable margins, and a punchy future earnings multiple. Curious how those pieces fit together to justify a price above today’s level? Explore the detailed financial roadmap behind that fair value.

Result: Fair Value of $207.5 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, the shift to SaaS and reliance on a handful of large, complex contracts could introduce more volatile revenues and pressure margins if implementations stumble.

Find out about the key risks to this Sectra narrative.

Build Your Own Sectra Narrative

If you see the story differently or want to stress test the assumptions yourself, you can build a personalised view in just minutes: Do it your way.

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Sectra.

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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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