Flex (FLEX) Stock Could Be 8% Undervalued After S&P 500 Inclusion

Flex (FLEX) is set to join the S&P 500 Index before trading opens on June 22, 2026. This inclusion often draws attention from index tracking funds and broadens the investor base.

See our latest analysis for Flex.

Flex’s recent S&P 500 inclusion comes after a strong run, with a 90 day share price return of 139.47% and a 1 year total shareholder return of 219.64%. This suggests momentum has been building rather than fading.

If this kind of index driven move has your attention, it may be worth broadening your watchlist and checking out 34 power grid technology and infrastructure stocks

With Flex now in the S&P 500, a share price of $147.61, a market cap of about $52.4b, and only a small discount to the current analyst target, the key question is whether there is still an attractive entry point or if the market already reflects expectations for future growth.

Most Popular Narrative: 8% Undervalued

Flex's most followed narrative points to a fair value of $160.40, compared with the last close at $147.61, which puts the spotlight on what is driving that gap.

The ongoing surge in demand for data center and AI infrastructure, requiring integrated power, cooling, and advanced IT hardware, positions Flex for sustained, outsized revenue growth, as evidenced by the 35% forecasted annual increase in its data center segment, supporting both topline expansion and higher portfolio margins.

Read the complete narrative.

Want to see how this AI data center story feeds into Flex's fair value? The narrative leans heavily on faster revenue growth, rising margins, and a richer earnings profile. Curious which specific long term forecasts justify that higher valuation and how they fit together? The full breakdown lays out the financial roadmap behind that price.

Result: Fair Value of $160.40 (UNDERVALUED)

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

However, Flex's heavy dependence on a small group of hyperscaler and data center customers, along with structurally thin margins, could quickly challenge this AI driven fair value story.

Find out about the key risks to this Flex narrative.

Another View: What Flex's P/E Ratio Is Telling You

While the popular Flex narrative leans on future growth to argue the stock is about 8% undervalued, the current P/E of 61.5x tells a different story. That is higher than both the US Electronic industry at 32.9x and peers at 58.6x, even though the fair ratio sits at 67.3x.

This gap suggests the market already prices in strong expectations, with only a modest cushion before the multiple lines up with the fair ratio. For investors, the practical question is whether those expectations leave enough room for error or upside if the story changes.

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

Next Steps

If the mixed sentiment around Flex has you weighing both excitement and caution, use that urgency to review the data and form your own stance by checking the 2 key rewards and 2 important warning signs.

Looking For More Investment Ideas Beyond Flex?

If Flex has sharpened your focus on where capital is working hardest, do not stop here. Broadening your universe now could be the edge you are looking for.

• Target steadier compounding by reviewing companies screened for resilience and lower overall risk through the 66 resilient stocks with low risk scores.
• Hunt for potential mispriced opportunities by scanning the 45 high quality undervalued stocks that pair quality fundamentals with a gap between price and underlying metrics.
• Spot future standouts early by checking the screener containing 20 high quality undiscovered gems before they appear on everyone else's radar.

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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