Does the Recent 5% Pullback Signal a New Opportunity for StoneX Group in 2025?

Thinking about what to do with StoneX Group stock right now? You would not be alone. After an incredible five-year run with shares climbing over 300%, followed by a 72% gain in the last year alone, plenty of investors are wondering if the stock’s recent pullback is an opportunity or a warning. Yes, the price retreated nearly 5% over the past month, and dipped almost 3% in just the last week, but that comes on the heels of a remarkable YTD climb over 46%. For a company that has quietly outperformed much of the market, these moves are more than just noise. They reflect investors reassessing the growth story, taking profits, and reconsidering risk.

It’s not all speculation and technical swings though. StoneX Group’s share price movement has tracked shifts in the broader financial markets landscape, including fluctuating interest rates and a global push for more robust risk management by institutions. Each development seems to prompt a new round of investor attention, often fueling the debate on what the stock is truly worth.

Of course, valuation is where things get interesting. On a valuation scorecard built on six fundamental checks for undervaluation, StoneX gets a 3. That is middle-of-the-road, neither a screaming bargain nor obviously overpriced, at least by traditional methods. Next, we will break down these key valuation approaches and what they reveal about where the opportunity may be. Stick around, because the real insight comes when we look beyond the usual numbers.

StoneX Group delivered 71.7% returns over the last year. See how this stacks up to the rest of the Capital Markets industry.

Approach 1: StoneX Group Excess Returns Analysis

The Excess Returns model gauges whether a company is generating meaningful returns above its cost of equity, which is the minimum rate of return investors expect in exchange for taking on risk. This valuation is especially relevant for financial firms like StoneX Group, where capital allocation and return consistency play a critical role in assessing long-term value.

For StoneX Group, the numbers show a solid foundation. The Book Value sits at $40.36 per share, with a Stable Earnings Per Share (EPS) of $5.08, derived from the median Return on Equity over the past five years. The company's Cost of Equity is $3.87 per share, and it produces an Excess Return of $1.22 per share. On average, StoneX is delivering a healthy 16.19% return on equity, suggesting management has historically made prudent use of shareholders’ capital. The Stable Book Value, calculated as $31.39 per share, further supports this view.

However, while StoneX’s historical returns are strong, the Excess Returns model estimates the intrinsic value is significantly below the current share price. The implied discount here is negative 120 percent, pointing to notable overvaluation based on these fundamentals.

Result: OVERVALUED

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

Our Excess Returns analysis suggests StoneX Group may be overvalued by 120.0%. Find undervalued stocks or create your own screener to find better value opportunities.

Approach 2: StoneX Group Price vs Earnings

The price-to-earnings (PE) ratio is particularly useful for analyzing profitable companies, as it directly relates the company's share price to its underlying earnings. Investors often look to the PE ratio to gauge whether a stock is attractively valued relative to its profit-generating power.

What constitutes a "fair" PE ratio can vary. Firms with high growth prospects or lower perceived risks often justify higher PE multiples. In contrast, slower growth or greater uncertainty usually warrants a discount.

StoneX Group currently trades at a PE ratio of 17.8x. Compared to the Capital Markets industry average of 25.53x and a peer average of 22.14x, StoneX appears less expensive by traditional measures.

Rather than benchmarking solely by industry or peer averages, Simply Wall St’s Fair Ratio takes the analysis further. This proprietary metric adjusts for specific factors such as StoneX Group’s earnings growth, profit margin, risk profile, size, and industry context. It provides a more tailored sense of what a "fair" valuation should be, given StoneX’s unique situation. In this case, the Fair Ratio for StoneX is 17.96x, which closely matches the current PE multiple of 17.8x.

The small difference between the Fair Ratio and actual PE suggests the stock is neither meaningfully overvalued nor undervalued based on these earnings and risk-adjusted benchmarks.

Result: ABOUT RIGHT

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

Upgrade Your Decision Making: Choose your StoneX Group Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. Narratives are an easy and powerful approach that lets you tell your own story behind the numbers, combining your perspective on a company’s business, its outlook, and your view of its fair value. In short, a Narrative links what you believe about StoneX Group’s future, such as its anticipated growth, margins, or risks, to your financial forecasts and produces a fair value based on your assumptions.

Available to millions of investors on Simply Wall St’s Community page, Narratives make it accessible for anyone to compare fair value to price and quickly decide if now is the right time to buy or sell. Because Narratives update dynamically when new information, news, or earnings arrive, your investment thesis stays relevant as the market evolves. For example, one investor’s Narrative may predict rapid future growth leading to a higher fair value, while another may expect slower progress and a more conservative target. This flexibility empowers you to invest based on your insights, not just historic ratios or consensus views.

Do you think there's more to the story for StoneX Group? Create your own Narrative to let the Community know!

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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