Liberty Energy (LBRT): Reassessing Valuation After a Sharp Pullback in Recent Share Price Performance

Liberty Energy (LBRT) has slipped roughly 6% in the past day and 9% over the past week, even after a strong past 3 months. This naturally raises questions about what the market is pricing in now.

See our latest analysis for Liberty Energy.

Zooming out, that sharp 1 week and 1 day pullback comes after a powerful 90 day share price return of about 65%, while the 1 year total shareholder return is only slightly negative. This suggests momentum is cooling but not broken.

If Liberty’s recent volatility has you rethinking your energy exposure, it might be worth scanning other fast growing stocks with high insider ownership that could offer a stronger mix of momentum and conviction.

With modest growth, a sharp earnings drop, and only a small gap to analyst targets, Liberty’s valuation is hardly screamingly cheap. So is this latest pullback a fresh buying opportunity, or is future growth already priced in?

Most Popular Narrative: 20% Undervalued

Against a fair value estimate of $18 per share, Liberty Energy’s last close near $17.97 implies only a razor thin discount before any upside.

Liberty's leadership in next-generation technology including its digiPrime/digiFleet natural gas-powered frac solutions and modular, low-emission power generation is enabling market share gains, operational efficiencies, longer asset life, and stronger pricing with top-tier customers, supporting improved margins and higher free cash flow.

Read the complete narrative.

Curious how modest revenue growth, shrinking margins, and a surprisingly rich future earnings multiple can still justify that fair value tag? The narrative’s math might surprise you.

Result: Fair Value of $18 (UNDERVALUED)

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

However, softening U.S. completions activity and delayed revenues from long lead power projects could easily derail the upbeat fair value story.

Find out about the key risks to this Liberty Energy narrative.

Another Lens on Value

Price based models tell a very different story. At 15.6 times earnings, Liberty looks cheaper than the US market at 19 times, the Energy Services industry at 18.4 times, and peers at 29.1 times. However, it still appears far richer than its 5.8 times fair ratio, which hints at potential downside if sentiment cools.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Liberty Energy Narrative

If you are not fully convinced by this view, or would rather test the assumptions yourself, you can build a tailored thesis in minutes, Do it your way.

A great starting point for your Liberty Energy research is our analysis highlighting 1 key reward and 4 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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