Plexus (PLXS): Reviewing Valuation After Its Recent Share Price Rebound

Plexus (PLXS) has quietly put up a strong run, with the stock up about 14% over the past month and 16% in the past 3 months, even as its 1 year return still lags.

See our latest analysis for Plexus.

With the share price now at $159.91 and a 30 day share price return close to 14%, Plexus is showing clear upward momentum. Its 1 year total shareholder return is still slightly negative, while multi year total shareholder returns remain strong.

If Plexus has you watching for what might run next, this could be a good moment to explore aerospace and defense stocks that may be benefiting from similar demand trends.

Yet with shares now hovering around analyst targets after a sharp rebound, investors face a key question: is Plexus still trading below its true worth or has the market already priced in the next leg of growth?

Most Popular Narrative Narrative: 1% Overvalued

With Plexus closing at $159.91 against a fair value near $159, the most followed narrative sees the recent rally landing almost exactly on its mark.

The analysts have a consensus price target of $154.6 for Plexus based on their expectations of its future earnings growth, profit margins and other risk factors. In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $4.8 billion, earnings will come to $202.1 million, and it would be trading on a PE ratio of 25.2x, assuming you use a discount rate of 8.3%.

Read the complete narrative.

Want to see what justifies a premium valuation for a mid cap manufacturer? The narrative leans on accelerating earnings, firmer margins and a richer future multiple. Curious how those pieces fit together?

Result: Fair Value of $159 (ABOUT RIGHT)

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

However, several risks could challenge this steady growth story, including customer demand pushouts in key sectors and intensifying price competition across electronic manufacturing services.

Find out about the key risks to this Plexus narrative.

Another View: Market Multiple Sends a Different Signal

While the narrative fair value sits near the current price, our SWS fair ratio points to Plexus trading rich. The stock is on a 24.8x earnings multiple, above a 21.7x fair ratio, yet only in line with the US Electronic industry and far below peer averages near 66x. That gap suggests less downside than a pure overvaluation call, but not much obvious bargain either. This leaves investors to ask whether this is more about quality than price.

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

Build Your Own Plexus Narrative

If you see Plexus differently or want to dig into the numbers yourself, you can build a fresh, personalized view in just a few minutes, Do it your way.

A great starting point for your Plexus research is our analysis highlighting 2 key rewards and 1 important warning sign 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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