Veralto (VLTO): Assessing Valuation After Recent Share Price Decline

Veralto (VLTO) shares recently dipped slightly over the past month, continuing a downward trend that has seen the stock decline about 10% during the past 3 months. Investors may be evaluating the company’s fundamentals, looking for potential value plays at current levels.

See our latest analysis for Veralto.

Veralto’s share price has come under pressure lately, continuing its decline with a 4.8% drop over the past month and a total shareholder return of -5.5% over the past year. Recent volatility suggests investors are becoming more cautious as they evaluate the company’s steady revenue growth and current valuation in the context of broader market sentiment.

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With Veralto trading at a notable discount to analyst price targets despite positive revenue and income growth, the key question remains: is the stock currently undervalued or is the market already pricing in future gains?

Most Popular Narrative: 15.4% Undervalued

Compared to Veralto's last closing price of $97.80, the most widely followed narrative sets a fair value target at $115.59. This sizable gap draws attention to the future growth expectations that underpin that estimate.

Increased adoption of digital workflow and connected software solutions (notably in PQI and Water Quality) is supporting high-margin, recurring revenue streams (now 61% of total sales), improving business predictability and supporting higher net margins and EPS growth.

Read the complete narrative.

Curious what makes this valuation tick? The assumptions driving this price lean heavily on accelerating financial metrics and stable recurring revenues. Find out which future trends and bold analyst projections create the foundation for this premium fair value mark.

Result: Fair Value of $115.59 (UNDERVALUED)

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

However, persistent weakness in China and rising input costs could limit Veralto’s margin expansion and constrain international revenue growth in the near term.

Find out about the key risks to this Veralto narrative.

Another View: What Do Our DCF Numbers Say?

Taking a different approach, the SWS DCF model estimates Veralto’s fair value at $137.62, which is much higher than both the current share price and analyst targets. This model leans on projected cash flows, raising the question: is the market missing the longer-term upside?

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

Build Your Own Veralto Narrative

If you have your own take or prefer to dig into the data independently, it’s quick and easy to shape your own view in just minutes. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Veralto.

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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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