OneMain Holdings (OMF): Evaluating Valuation After a 40% One-Year Share Price Rally

OneMain Holdings (OMF) has quietly put together a strong run, with the stock up about 17% over the past month and more than 40% in the past year, outpacing many consumer lenders.

See our latest analysis for OneMain Holdings.

With the share price now around $68.30 and a robust 1 year total shareholder return of roughly 42 percent, momentum still looks constructive even though the very short term share price returns have cooled slightly after a strong 30 day share price gain.

If OneMain has caught your attention as a momentum and income story, it could be worth exploring other financial names using fast growing stocks with high insider ownership to see which businesses combine growth potential with aligned insider incentives.

Yet with the shares now hovering near analyst targets but still trading at a hefty discount to some intrinsic value estimates, the key question is whether OneMain remains undervalued or if the market is already pricing in its growth potential.

Most Popular Narrative Narrative: 3% Overvalued

With OneMain's fair value estimate sitting just below the current $68.30 share price, the most followed narrative suggests the market is now slightly ahead of itself.

Management's commitment to robust shareholder capital returns via a 7% dividend yield and escalating buybacks, now ahead of the prior year, provides a catalyst for EPS growth and may attract additional yield focused investors if the stock remains undervalued.

Read the complete narrative.

Want to see what kind of revenue surge, margin reset, and future earnings multiple could justify this price target drift higher? The detailed narrative lays out an aggressive growth arc, shrinking profitability, and a lower forward valuation bar that still implies meaningful upside if execution holds. Curious which moving piece matters most to that fair value math? Read on to see what is really driving this call.

Result: Fair Value of $66.29 (OVERVALUED)

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

However, the narrative could unravel if higher funding costs squeeze margins or a weaker macro backdrop drives charge offs above already elevated expectations.

Find out about the key risks to this OneMain Holdings narrative.

Another Angle on Value

Analysts see OneMain as about 3 percent overvalued at roughly $66 per share, yet our DCF model is more optimistic and suggests fair value closer to $113. With such a wide gap in conviction, which view do you trust when real money is on the line?

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

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out OneMain Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 914 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own OneMain Holdings Narrative

If you see the story differently or want to test your own assumptions against the numbers, you can build a personalized view in just minutes: Do it your way.

A great starting point for your OneMain Holdings research is our analysis highlighting 2 key rewards and 2 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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