A Discounted Cash Flow model estimates what a company is worth by projecting the cash it can generate in the future and then discounting those cash flows back to today, using an appropriate required return.<\/p>\n
For ABB, the model starts with last twelve month free cash flow of about $4.2 billion and then applies analyst forecasts and longer term extrapolations. Analysts provide detailed estimates for the next few years, with free cash flow expected to rise from roughly $4.5 billion in 2026 to around $5.6 billion by 2029. Beyond that, Simply Wall St extends the trend with modest growth assumptions, taking projected free cash flow to roughly $5.8 billion by 2035.<\/p>\n
When these projected cash flows are discounted back to today using a 2 Stage Free Cash Flow to Equity framework, the resulting intrinsic value is about $44.11 per share. Compared to the current share price, this implies ABB is roughly 29.9% overvalued on a pure cash flow basis. This suggests the market is already paying up for its growth story.<\/p>\n
Result: OVERVALUED<\/p>\n
Our Discounted Cash Flow (DCF) analysis suggests ABB may be overvalued by 29.9%. Discover 912 undervalued stocks<\/a> or create your own screener<\/a> to find better value opportunities.<\/p>\n Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for ABB.<\/a><\/p>\n Story Continues <\/p>\n For profitable companies like ABB, the price to earnings ratio is a straightforward way to gauge what investors are willing to pay today for each unit of current earnings. In general, higher expected growth and lower perceived risk justify a higher PE, while slower growth or elevated risk call for a lower, more conservative multiple.<\/p>\n ABB currently trades on a PE of about 29.4x, which is broadly in line with the Electrical industry average of around 29.1x and slightly above the peer group average of roughly 28.0x. Simply Wall St also calculates a proprietary Fair Ratio of 36.8x for ABB, which represents the PE you might expect once you factor in the company\u2019s earnings growth outlook, margins, risk profile, size, and industry positioning.<\/p>\n This Fair Ratio is more informative than a simple peer or sector comparison because it adjusts for ABB\u2019s specific strengths and risks rather than assuming all industrials should trade on the same multiple. With ABB\u2019s actual PE sitting below the Fair Ratio, the shares appear modestly undervalued on this metric.<\/p>\n Result: UNDERVALUED<\/p>\n PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1463 companies where insiders are betting big on explosive growth<\/a>.<\/p>\n Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, a simple framework that lets you attach a clear story to your numbers by combining your view on ABB\u2019s future revenues, earnings, and margins with a financial forecast and resulting fair value. On Simply Wall St\u2019s Community page, used by millions of investors, a Narrative is essentially your investment storyline translated into a forecast and a fair value estimate, which you can then compare with the current share price to help inform whether ABB looks like a buy, hold, or sell. Because Narratives are updated dynamically as new information like earnings, news, or guidance arrives, they remain living, adaptable views rather than static targets. For example, one optimistic ABB Narrative might assume robust electrification demand, margin expansion toward about 14 percent, and justify a fair value close to CHF 65. A more cautious Narrative might emphasize sector competition and softer end markets, and point to a fair value nearer CHF 37. Seeing both side by side helps you decide which story and valuation you find more convincing.<\/p>\n Do you think there’s more to the story for ABB? Head over to our Community to see what others are saying!<\/a><\/p>\n 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.<\/p>\n Companies discussed in this article include ABBN.SW<\/a>.<\/p>\n Have feedback on this article? Concerned about the content? Get in touch<\/a> with us directly. Alternatively, email editorial-team@simplywallst.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Wondering if ABB is still a smart buy at today\u2019s price, or if most of the upside has…\n","protected":false},"author":2,"featured_media":668,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[130],"tags":[232,3632,1103,1105,14277,14276],"class_list":{"0":"post-21832","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-abb","8":"tag-abb","9":"tag-cash-flow","10":"tag-dcf","11":"tag-free-cash-flow","12":"tag-growth-story","13":"tag-valuation-methods"},"share_on_mastodon":{"url":"","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/21832","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=21832"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/21832\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/668"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=21832"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=21832"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=21832"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"ABBN](\"https:\/\/www.europesays.com\/ch\/wp-content\/uploads\/2026\/02\/5498a5f711ec86b8725e9beb7367a1d7.png\")
<\/a> ABBN Discounted Cash Flow as at Dec 2025 <\/p>\n<\/a> SWX:ABBN PE Ratio as at Dec 2025 <\/p>\n
<\/a> SWX:ABBN 1-Year Stock Price Chart <\/p>\n