The Discounted Cash Flow (DCF) model estimates the value of a company by projecting its future cash flows and then discounting those amounts back to today’s value. This approach models how much cash ABB is expected to generate and considers its worth at present by taking into account the time value of money.<\/p>\n
According to the latest figures, ABB generated $4.18 Billion in Free Cash Flow (FCF) over the last twelve months. Analyst forecasts project steady cash flow growth, with FCF expected to reach $5.56 Billion by 2029. While analysts provide detailed estimates for up to five years, further projections are developed using internal methods.<\/p>\n
Based on these cash flow projections, the DCF model arrives at an intrinsic fair value of $45.33 per share. However, ABB’s current share price trades at a 26.0% premium to this estimated value, meaning the stock appears overvalued according to this methodology.<\/p>\n
Result: OVERVALUED<\/p>\n
Our Discounted Cash Flow (DCF) analysis suggests ABB may be overvalued by 26.0%. Discover 934 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 The Price-to-Earnings (PE) ratio is a widely used metric for valuing profitable companies like ABB because it directly relates the company’s share price to its current earnings. This makes it an intuitive tool for investors to gauge value. When a company is consistently profitable, the PE ratio serves as a quick way to compare its valuation within its own industry and against the broader market.<\/p>\n Story Continues <\/p>\n Growth expectations and business risk both play a crucial role in determining what can be considered a “normal” or “fair” PE ratio. Companies with higher expected earnings growth and lower risk profiles tend to command higher PE multiples, while those facing more uncertainty or slower growth often trade at a discount to the market.<\/p>\n ABB currently trades at a PE ratio of 29.0x. This is very close to both its industry average PE of 29.0x and its peer average of 28.4x. This suggests shareholders are paying a similar price for ABB’s earnings as they would for comparable companies. However, Simply Wall St’s proprietary \u201cFair Ratio\u201d model calculates that ABB’s fair PE should be 36.7x, taking into account not only peer and industry comparisons but also the company\u2019s unique growth prospects, risk factors, profit margins, and market capitalization.<\/p>\n The \u201cFair Ratio\u201d provides a broader assessment than conventional benchmarks because it weighs all the key ingredients that can drive value for shareholders, including forward-looking estimates and risk-adjusted returns, rather than relying solely on historical or static averages. This approach provides a more tailored benchmark for ABB\u2019s specific position within the market.<\/p>\n Given ABB\u2019s Fair Ratio (36.7x) is notably above its current PE (29.0x), the stock appears undervalued on this basis.<\/p>\n Result: UNDERVALUED<\/p>\n PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1441 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’s introduce you to Narratives. A Narrative is more than just a number; it is your personal investment story for a company, built around your assumptions on fair value, future revenue, earnings, and profit margins. Narratives connect the business\u2019s unique real-world story to a forward-looking financial forecast and then directly to a fair value estimate, helping you see where your view stands in relation to the crowd.<\/p>\n Narratives are easy to create and share on Simply Wall St’s Community page, where millions of investors can compare their perspectives in real time. They help you navigate buy, sell, or hold decisions by lining up your Fair Value against the latest share price, and they automatically update if breaking news or fresh results change the outlook. For example, with ABB, one Narrative may project revenue climbing to $39.3 billion and earnings of $5.5 billion by 2028 (supporting a price target near CHF65.13), while another might use more cautious estimates and settle on a fair value closer to CHF36.98.<\/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 could be a smart buy, or if the current price is already too high? You…\n","protected":false},"author":2,"featured_media":668,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[130],"tags":[232,22586,1103,1104,3794,842],"class_list":{"0":"post-38821","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-abb","8":"tag-abb","9":"tag-abb-discounted-cash-flow","10":"tag-dcf","11":"tag-fair-value","12":"tag-future-cash-flows","13":"tag-share-price"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/116292012214856077","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/38821","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=38821"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/38821\/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=38821"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=38821"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=38821"}],"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 Nov 2025 <\/p>\n<\/a> SWX:ABBN PE Ratio as at Nov 2025 <\/p>\n
<\/a> SWX:ABBN Community Fair Values as at Nov 2025 <\/p>\n