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ABB (SWX:ABBN) is drawing investor attention after recent share price gains over the past month and past 3 months, prompting a closer look at how its electrification, motion, and automation businesses support its current valuation.
See our latest analysis for ABB.
At a share price of CHF69.8, ABB has logged a 13.31% 1 month share price return and 28.17% 3 month share price return, while its 1 year total shareholder return of 34.53% and very large 5 year total shareholder return reflect the momentum investors are currently pricing in.
If ABB’s recent run has you thinking more broadly about electrification and automation, it could be a good time to scan 24 power grid technology and infrastructure stocks for other grid focused opportunities.
With ABB trading at CHF69.8 and sitting above both the average analyst price target and the intrinsic value estimate, the key question now is whether the recent strength leaves limited upside or if the market is still underestimating future growth potential.
ABB’s most followed narrative puts fair value at CHF56.44 compared with the current CHF69.8, framing the recent share price strength as a valuation stretch.
Record-high order backlog ($25 billion), broad-based order growth across regions, and multi-year service contracts in process automation provide strong forward earnings visibility and support for sustained revenue and margin expansion over the medium to long term.
Want to see how that backlog, expected revenue trajectory, margin profile, and future earnings multiple all fit together into one valuation story? The full narrative spells out the growth runway, the profitability curve, and the pricing assumptions sitting behind that CHF56.44 fair value call.
Result: Fair Value of CHF56.44 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, weaker demand in key end markets and intense competition in robotics, especially in China, could pressure ABB’s margins and challenge that fair value story.
Find out about the key risks to this ABB narrative.
If this mix of optimism and concern around ABB has you thinking, do not wait too long to look under the hood yourself with 3 key rewards and 1 important warning sign.
If ABB has sharpened your focus, do not stop here. The screener can quickly surface a wider range of ideas that might better fit your style.