• If you are wondering whether IDACORP's current share price reflects its true value, this article will walk through what the numbers are actually saying about the stock.
• IDACORP recently closed at US$143.45, with returns of 8.5% over 30 days, 12.7% year to date, 29.0% over 1 year, 51.9% over 3 years and 88.9% over 5 years. These figures can influence how investors think about both its growth potential and risk profile.
• Recent coverage around IDACORP has focused on its position as a regulated utility and how the market is weighing its stability against broader sector and rate related sentiment. This context helps explain why the share price has been active lately and why investors are paying close attention to how it is being valued.
• Our valuation review scores IDACORP at 1 out of 6 on key checks for being undervalued. Next we will look at what traditional valuation methods say about the stock, and then finish with a more complete way to think about value that goes beyond a single score.

IDACORP scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: IDACORP Dividend Discount Model (DDM) Analysis

The Dividend Discount Model looks at a stock as a stream of future dividends, then estimates what that stream could be worth today based on expected growth and a required return. It is especially common for regulated utilities where dividends are a key part of the investment case.

For IDACORP, the model uses a current dividend per share of about US$4.01, a return on equity of 9.37% and a payout ratio of roughly 60.12%. The implied long term dividend growth rate used in the model is 3.41%, capped from a higher starting estimate of 3.74%. That growth rate sits slightly below the model’s raw expected growth input of about 3.74%, which adds a degree of caution around projections for future dividend expansion.

Putting these inputs together, the DDM output points to an estimated intrinsic value of US$112.32 per share. Compared with the recent share price of US$143.45, this implies the stock is around 27.7% above this dividend based valuation framework.

Result: OVERVALUED

Our Dividend Discount Model (DDM) analysis suggests IDACORP may be overvalued by 27.7%. Discover 56 high quality undervalued stocks or create your own screener to find better value opportunities.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for IDACORP.

Approach 2: IDACORP Price vs Earnings

For a profitable company like IDACORP, the P/E ratio is a useful way to see how much investors are paying for each dollar of earnings. It ties the share price directly to current profits, which is especially relevant for established utilities where earnings are a key focus.

What counts as a “normal” P/E depends on how the market views a company’s growth potential and risk. Higher expected growth or lower perceived risk can justify a higher P/E, while slower growth or higher risk usually points to a lower multiple being more reasonable.

IDACORP currently trades on a P/E of 24.35x, which is close to both the Electric Utilities industry average of 22.48x and the peer average of 24.83x. Simply Wall St’s Fair Ratio for IDACORP is 20.72x. This Fair Ratio is a proprietary estimate of what a suitable P/E might be given factors such as the company’s earnings growth profile, industry, profit margins, market cap and risk characteristics. Because it blends these company specific inputs, it can be more informative than a simple comparison with peers or the industry alone.

Comparing the current P/E of 24.35x with the Fair Ratio of 20.72x suggests the shares are priced above this customised benchmark.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your IDACORP Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, a simple tool on Simply Wall St’s Community page that lets you set your own story for IDACORP by linking your assumptions about future revenue, earnings, margins and fair value to a clear forecast that updates automatically when new news or earnings arrive, then compares your Fair Value to the current price so you can judge whether it looks like a buy or a sell for you. You can lean closer to the more optimistic view that sees IDACORP at a Fair Value of about US$141.63 based on higher growth and margins, or a more cautious view that treats the analysts’ consensus target of about US$132.67 as closer to fair, all inside the same easy framework.

Do you think there's more to the story for IDACORP? Head over to our Community to see what others are saying!

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Disclaimer:This article represents the opinion of the author only. It does not represent the opinion of Webull, nor should it be viewed as an indication that Webull either agrees with or confirms the truthfulness or accuracy of the information. It should not be considered as investment advice from Webull or anyone else, nor should it be used as the basis of any investment decision.