Has Recent Specialty Vehicle News Already Fueled REV Group’s Stock Price in 2025?

• Wondering if REV Group could be a hidden gem or if the recent buzz has already been reflected in the price? Let's unpack what's been fueling investor interest in this stock.
• REV Group's stock has experienced notable movement, gaining 5.9% over the last week and 72.8% in the past year. There was also a brief dip of 11.2% in the last month.
• News about new product launches and increased interest in specialty vehicles have kept REV Group in focus, especially as larger contracts were announced recently. These developments have sparked discussion about the stock’s real value moving forward.
• According to our valuation framework, REV Group scores 2 out of 6 for undervaluation, suggesting there may be more to consider before making any bold decisions. We will walk through the standard valuation approaches next and highlight a method that could offer a different perspective by the end of this article.

REV Group scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: REV Group Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow (DCF) model estimates a company's intrinsic value by projecting its future cash flows and discounting them back to today's value, reflecting the time value of money. This approach helps assess whether a stock is priced attractively or not based on its real earning power.

For REV Group, the latest reported Free Cash Flow stands at $201.5 million. Analysts provide detailed forecasts for the next several years, and beyond this, future cash flows are extrapolated based on historical and industry data. According to these long-term projections, REV Group's Free Cash Flow is expected to be around $129.4 million by 2027 and continue at a relatively stable pace, culminating in a projected $129.4 million to $129.4 million range over ten years.

Using the 2 Stage Free Cash Flow to Equity model, REV Group's intrinsic fair value comes out to $40.90 per share. However, the DCF model indicates the shares are trading at a 30.2% premium to this intrinsic value. This signals that the market price is currently overestimating the company's future cash generation.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests REV Group may be overvalued by 30.2%. Discover 921 undervalued stocks or create your own screener to find better value opportunities.

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

Approach 2: REV Group Price vs Earnings (PE Ratio)

The Price-to-Earnings (PE) ratio is a widely used and reliable way to value profitable companies, because it connects a stock’s current price directly to its earnings performance. For investors, the PE ratio helps indicate whether a stock is expensive or cheap relative to its ability to generate profit.

What counts as a “normal” PE ratio will vary based on expectations for growth and risk. Higher growth prospects or lower risk typically justify a higher PE ratio, while slower growth or more risk support a lower ratio.

REV Group’s current PE ratio is 24.1x. This is very close to the Machinery industry average PE of 24.9x, but it is notably higher than its selected peers’ average of 16.9x. At first glance, this could suggest the stock is priced above its direct competitors.

Simply Wall St’s proprietary Fair Ratio for REV Group is 28.2x. Unlike simple industry or peer benchmarks, this Fair Ratio method accounts for a mix of factors unique to the company, including growth outlook, operational risks, profit margins, industry trends, and market capitalization. That makes it a more thoughtful benchmark for investors trying to assess whether a company's premium is justified.

Comparing REV Group’s current PE ratio (24.1x) to its Fair Ratio (28.2x) suggests the shares are about right in value, trading marginally below what would be reasonable given its forecast growth and company profile.

Result: ABOUT RIGHT

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1438 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your REV Group Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is simply your story or viewpoint about REV Group’s future, the reasons behind your expectations for its fair value, revenue, earnings, and margins. It connects what you believe is most important about the company (whether that’s new contracts, industry shifts, or profit risks) directly to your own financial forecast, and from there to a fair value estimate.

Narratives are easy to create and update on Simply Wall St’s Community page, where millions of investors share their perspectives. This tool helps you see clearly when to buy or sell by comparing your Narrative’s Fair Value to the current Price, giving you a personalized, forward-looking roadmap for action.

What’s more, Narratives update automatically as new earnings and news arrive, so your view always reflects the latest developments. For example, one investor might see the analyst consensus price target of $65.75 as realistic due to operational improvements and policy-driven demand, while another could assign a much lower fair value of $55 by focusing on merger uncertainties and margin risks. Narratives allow you to transparently connect your personal research, the company story, and the numbers, all in one place.

Do you think there's more to the story for REV Group? 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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