Has SharkNinja’s 12.8% Drop Opened an Opportunity After Its Product Expansion News?

• Wondering if SharkNinja’s stock is a hidden bargain or just riding the latest hype? You’re not alone. Now is the perfect time to dig in.
• Despite all the buzz, SharkNinja shares have dropped by 11.6% over the past week and 12.8% over the past month, hinting at shifting sentiment or uncertainty in the market.
• Recently, news has focused on SharkNinja’s product expansion and its push into new markets. Investors are watching these developments closely. These moves could explain some of the volatility, as the company tests new strategies and investors adjust their expectations.
• The Simply Wall St valuation score for SharkNinja is 4 out of 6, suggesting the stock looks undervalued across most traditional metrics. In the next sections, we will break down how this score comes together and explore whether there is an even better way to assess what SharkNinja is really worth.

SharkNinja delivered -6.3% returns over the last year. See how this stacks up to the rest of the Consumer Durables industry.

Approach 1: SharkNinja Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model helps estimate a company’s intrinsic value by projecting its expected future cash flows and then discounting those amounts back to their value today. This method is widely used for evaluating businesses like SharkNinja, where future cash flow potential is an important driver of valuation.

For 2023, SharkNinja reported Free Cash Flow (FCF) of $239.7 million. Analysts provide specific projections for the next five years, and beyond that, estimates are extrapolated. The company’s FCF is expected to grow significantly, reaching $1.19 billion by 2029 according to these models. This rapid growth is based on a combination of analyst inputs and further extrapolation.

Using the 2 Stage Free Cash Flow to Equity model, the DCF analysis produces an estimated intrinsic value for SharkNinja shares of $163.33. This suggests the stock is trading at a sizable discount, about 47.7% below its calculated value today.

In summary, the DCF approach implies that SharkNinja shares are strongly undervalued based on long-term cash flow expectations.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests SharkNinja is undervalued by 47.7%. Track this in your watchlist or portfolio, or discover 841 more undervalued stocks based on cash flows.

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

Approach 2: SharkNinja Price vs Earnings (PE)

For profitable companies like SharkNinja, the Price-to-Earnings (PE) ratio is a widely accepted way to gauge valuation because it directly compares today’s share price to the company’s net earnings. The PE ratio helps investors see how much they are paying for each dollar of current earnings, which is especially meaningful when earnings are strong and consistent.

What counts as a “fair” PE ratio depends on many factors, including how fast a company is expected to grow and the level of risk it faces compared to its sector. A higher expected growth rate or lower risk often justifies a higher multiple, while slow growth or more risk calls for a lower one.

Currently, SharkNinja trades at a PE of 23.3x. That is above the Consumer Durables industry average of 10.6x and modestly below the average for similar peers at 26.8x. However, these benchmarks do not account for company-specific differences such as SharkNinja’s growth profile, margins, and risks. That is where the Simply Wall St Fair Ratio comes in at 19.9x for SharkNinja, which offers a tailored benchmark reflecting both the company and its context, rather than a broad-brush comparison.

The Fair Ratio is a more accurate guide because it blends SharkNinja’s earnings growth potential, profit margins, market size and risk factors, giving a better sense of what the PE “should” be for this specific company, not just a whole industry or group.

Comparing the Fair Ratio of 19.9x to the current PE of 23.3x, SharkNinja is trading at a premium to its fundamentals, suggesting the stock is currently overvalued using this approach.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your SharkNinja Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is your story about a company—your unique perspective on its future where you can outline the reasons behind your assumptions and connect the dots between expected business changes, financial forecasts, and fair value estimates. Narratives make it easy to tie together everything you know or believe about SharkNinja, from recent product launches to industry risks, by linking a company’s story to projected numbers and then to a calculated fair value, all in a single, structured view.

Available on Simply Wall St’s Community page and used by millions of investors, Narratives empower you to take charge of your investment decisions. They help you quickly see if SharkNinja’s fair value, based on your outlook, is above or below today’s price, making it easier to decide when to act. Best of all, Narratives update automatically as new information such as earnings results or breaking news comes in, so your view stays current.

For example, some investors expect SharkNinja to surge toward the most bullish target of $175 per share by 2028 if new product launches keep driving strong growth. Others see risks that could limit value to closer to $117 per share if rising costs and competition weigh down margins and demand. With Narratives, you can transparently explore both outlooks, stress test your assumptions, and track how fair value shifts as the story unfolds.

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