- If you have been watching ICL Group and wondering whether the current share price reflects its true value, this breakdown will help you frame what the market might be pricing in today.
- The stock last closed at US$5.24, with recent returns of 1.2% over 7 days and 6.1% over 30 days, set against year to date and 1 year returns of a 9.5% decline and a 5.6% decline.
- Recent headlines around ICL Group have focused on its position within the wider materials sector and how investors are weighing that exposure against other opportunities. This context helps explain why the share price has moved in the short term, while longer term returns over 3 and 5 years, at a 10.7% decline and a 0.4% decline, tell a different story.
- ICL Group currently has a valuation score of 0 out of 6. Next, you will see how different valuation methods frame the stock, and then you will see one more approach that can help you think about value in a more complete way.
ICL Group scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
Approach 1: ICL Group Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model estimates what a company could be worth by projecting its future cash flows and discounting them back to today, to reflect the time value of money and risk.
For ICL Group, the model used is a 2 Stage Free Cash Flow to Equity approach based on cash flow projections. The latest twelve month Free Cash Flow is about $286.2 million. Analysts provide explicit Free Cash Flow estimates for the next few years. Beyond that, Simply Wall St extrapolates the trend to build out a 10 year path. Under these assumptions, projected Free Cash Flow in 2035 is $418.2 million, with each future year discounted back to a present value in dollars.
Combining all those discounted projections gives an estimated intrinsic value of about US$3.97 per share. Compared with the recent share price of US$5.24, the DCF output implies the stock is around 32.1% overvalued on this set of assumptions.
Result: OVERVALUED
Our Discounted Cash Flow (DCF) analysis suggests ICL Group may be overvalued by 32.1%. Discover 62 high quality undervalued stocks or create your own screener to find better value opportunities.
Approach 2: ICL Group Price vs Earnings
For a profitable company like ICL Group, the P/E ratio is a straightforward way to think about what you are paying for each dollar of earnings. Investors usually expect higher growth and lower risk to justify a higher P/E, while slower growth or higher uncertainty tend to line up with a lower, more cautious P/E range.
ICL Group currently trades on a P/E of 29.93x. That is close to the broader Chemicals industry average P/E of 29.18x and above the peer group average of 16.32x. By itself, that tells you the market is pricing ICL Group broadly in line with the wider industry, but at a premium to peers that share similar characteristics.
Simply Wall St also uses a proprietary “Fair Ratio”, which is the P/E level it would expect for ICL Group once factors such as earnings growth, profit margins, industry, market cap and company specific risks are taken into account. This is more tailored than a simple comparison with peers or industry averages, because it adjusts for the company’s own profile instead of assuming all businesses in the sector deserve the same multiple. Comparing the Fair Ratio with the actual 29.93x P/E suggests the stock is OVERVALUED on this measure.
Result: OVERVALUED
P/E ratios tell one story, but what if the real opportunity lies elsewhere? Start investing in legacies, not executives. Discover our 20 top founder-led companies.
Upgrade Your Decision Making: Choose your ICL Group Narrative
Earlier it was mentioned that there is an even better way to understand valuation, so Narratives are introduced as a simple way for you to attach your own story about ICL Group to the numbers, linking what you believe about its revenue, earnings and margins to a forecast and then to a fair value that you can compare with the current price.
On Simply Wall St's Community page, Narratives are an easy tool used by millions of investors. You can set assumptions, see the fair value that follows from them, and then quickly spot whether your view suggests ICL Group is worth more or less than the market price. This can help you decide if it is closer to a buying or selling opportunity for your portfolio.
Narratives also update automatically when new information arrives, such as the latest potash supply agreements, earnings, dividend changes or guidance. This keeps your fair value estimate aligned with what is happening in real time instead of leaving it frozen on old data.
For example, one ICL Group Narrative on the Community page might lean toward the higher analyst target of US$6.00 based on confidence in projects like battery materials and diversification. Another Narrative might sit closer to the lower US$4.50 target because it places more weight on risks from geopolitics, phosphate prices or potash volume limits. Seeing these side by side helps you decide which story matches your own expectations.
Do you think there's more to the story for ICL Group? 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