Is Johnson Controls (JCI) Still Undervalued After Recent Stock Gains?

Johnson Controls International (JCI) has seen its stock make steady moves lately, with shares rising nearly 2% over the past month and up more than 39% over the past year. The company’s recent performance continues to draw interest from investors looking for consistency and growth within the capital goods sector.

See our latest analysis for Johnson Controls International.

The steady climb in Johnson Controls International’s share price, now at $114.65, reflects both building momentum and renewed confidence in its growth outlook. With a remarkable 39% total shareholder return over the past year and an 87% gain over three years, the company’s solid track record and recent performance suggest investor optimism is holding strong.

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But with Johnson Controls trading just below analyst price targets despite impressive gains and strong earnings growth, the question remains: is there still value left for new investors, or is all the potential upside already reflected in the price?

Most Popular Narrative: 7.5% Undervalued

Johnson Controls International’s fair value estimate from the most widely followed narrative is $124 per share, above the last close at $114.65. This signals that, according to current projections, there may still be room for upside based on future fundamentals.

The new organizational model and Lean practices are expected to drive revenue growth and enhance net margins significantly. Strong demand in key platforms and expanded service capabilities will contribute to more predictable revenue and higher margins.

Read the complete narrative.

Want to uncover where analysts see the biggest future gains? The secret drivers include ambitious profit targets and a margin outlook that surprises even seasoned investors. Can these aggressive projections really hold up in a shifting market? Find out which hot-button financial assumptions are behind this “undervalued” call and explore the details that could change your perspective.

Result: Fair Value of $124 (UNDERVALUED)

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

However, supply chain hurdles or execution issues with new operational changes could still challenge the company’s forecasted margin improvements and growth momentum.

Find out about the key risks to this Johnson Controls International narrative.

Another View: Market Multiples Raise Caution

Looking at valuation from a different angle, Johnson Controls International trades at a price-to-earnings ratio of 40.7x, which is significantly higher than both the US Building industry average of 17.3x and the fair ratio of 36.7x. This suggests the stock is pricey compared to peers and could potentially limit future upside. Could this premium signal over-optimism, or is there more room to run?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Johnson Controls International Narrative

If the current perspective doesn't quite fit your own, you're free to dig into the details yourself and shape a narrative that fits your view in just minutes. Do it your way

A great starting point for your Johnson Controls International research is our analysis highlighting 2 key rewards and 3 important warning signs 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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