- If you are wondering whether Itron at around US$92.99 is offering good value today, you are not alone in asking what the current share price really reflects.
- The stock has recently shown a mixed return pattern, with a 2.8% gain over the past week, a 3.3% decline over the past month, and a 1.6% decline year to date, while the 1 year return sits at a 6.6% loss and the 3 year return at 73.8%.
- Recent coverage around Itron has focused on its role in power grid technology and smart infrastructure. This helps frame how investors think about its long term potential and provides useful context when weighing shorter term share price moves against the broader story investors are watching.
- Itron currently holds a valuation score of 6 out of 6. The rest of this article will compare what that means across different valuation methods and will also hint at an even richer way to think about value at the end.
Find out why Itron's -6.6% return over the last year is lagging behind its peers.
Approach 1: Itron Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow model takes forecasts of a company’s future cash flows and discounts them back to today using a required rate of return, aiming to estimate what those future dollars are worth right now.
For Itron, the latest twelve month Free Cash Flow is about $378.7m. Analyst and extrapolated projections supplied to the model show annual Free Cash Flow figures reaching $603.5m in 2035, with intermediate years such as 2026 and 2028 at $302.8m and $450.0m respectively. Simply Wall St uses a 2 Stage Free Cash Flow to Equity approach, where earlier years use more detailed inputs and later years are extrapolated from those trends.
When all those projected cash flows are discounted back to today, the model arrives at an estimated intrinsic value of $167.03 per share. Compared with the recent share price around $92.99, the DCF output suggests Itron is trading at a 44.3% discount to this estimate, which indicates it screens as undervalued on this model.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Itron is undervalued by 44.3%. Track this in your watchlist or portfolio, or discover 64 more high quality undervalued stocks.
Approach 2: Itron Price vs Earnings
For a profitable business, the P/E ratio is a useful yardstick because it tells you how much you are paying for each dollar of current earnings. Investors usually accept a higher P/E when they expect stronger growth and lower perceived risk, while slower growth or higher risk tends to justify a lower, more conservative multiple.
Itron currently trades on a P/E of 13.69x. That sits below the Electronic industry average P/E of 31.03x and also below the peer group average of 78.72x. Simply Wall St also provides a proprietary “Fair Ratio” of 19.64x, which is the P/E it estimates for Itron after considering factors such as earnings growth, profit margins, industry, market cap and specific risks.
This Fair Ratio is more tailored than a simple comparison with peers or the broad industry, because it adjusts for Itron’s own profile rather than assuming all companies deserve the same multiple. With the current P/E of 13.69x sitting below the Fair Ratio of 19.64x, this approach suggests the shares are trading at a discount to what might be considered a more company specific normal level.
Result: UNDERVALUED
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Upgrade Your Decision Making: Choose your Itron Narrative
Earlier it was mentioned that there is an even better way to understand valuation. Narratives on Simply Wall St’s Community page let you link your story about Itron to the numbers by turning your view on its smart grid opportunity, risks around regulatory delays, or the analysts’ fair value of US$136.80 into a specific forecast for revenue, earnings and margins. You can then compare that Fair Value to the current price around US$93.54 to decide whether the stock looks attractive or stretched, and see that view automatically refresh as new earnings, guidance or contract news arrives. This is why one investor might build a more optimistic Itron Narrative around the higher 2029 earnings expectation of US$474.5m, while another builds a more cautious one around the lower US$317.4m, each backing their perspective with a clear valuation rather than a headline price target.
Do you think there's more to the story for Itron? 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.
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