Assessing Avient (AVNT) Valuation After Q3 Earnings and Updated Growth Guidance
Avient (AVNT) released its latest quarterly earnings, meeting expectations for adjusted EPS even as sales came in lower than the previous year. Management also offered guidance indicating a modest uptick in fourth quarter sales.
See our latest analysis for Avient.
Avient’s latest results and cautious guidance appear to have done little to shift investor sentiment, with the share price sliding about 15% over the last three months and posting a year-to-date drop of 25%. Weakness in the market has weighed on the stock, and this year’s 1-year total shareholder return of -39% reflects both price declines and lost dividends. There is still a modest three-year TSR gain in the background, suggesting some underlying resilience if the company can turn momentum its way.
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With the shares trading well below analyst targets and recent results showing signs of operational resilience, the question is whether Avient is now undervalued or if the market has fully accounted for its future growth prospects.
Most Popular Narrative: 28.4% Undervalued
With Avient’s fair value pegged at $42.13 versus a last close at $30.15, the most widely followed narrative signals substantial upside ahead if its projections hold true.
“Analysts are assuming Avient's revenue will grow by 3.3% annually over the next 3 years. Analysts assume that profit margins will increase from 3.7% today to 8.6% in 3 years time.”
Curious about what’s fueling this bullish outlook? The fair value relies on an ambitious profit growth leap, faster margin expansion, and a future earnings multiple that is uncommon in legacy materials stocks. Want to discover what financial goals must be met for this price to become reality? Don’t miss the details driving this narrative’s punchy target.
Result: Fair Value of $42.13 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, if key end markets remain depressed or if inflation in raw materials persists, Avient’s ambitious growth outlook could face meaningful setbacks.
Find out about the key risks to this Avient narrative.
Build Your Own Avient Narrative
If you look at these numbers and reach different conclusions, or prefer to dig into the data on your own terms, you can craft a fresh take in under three minutes. Do it your way
A great starting point for your Avient research is our analysis highlighting 4 key rewards and 2 important warning signs 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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