• If you are wondering whether Equitable Holdings is attractively priced right now or if the market already reflects its potential, this article is designed to help you assess that question with a clear focus on value.
• The stock last closed at US$39.78, with returns of 49.9% over 3 years and 41.7% over 5 years. More recently, the share price has moved lower, with a 5.1% decline over 7 days, an 11.0% decline over 30 days, a 17.1% decline year to date, and an 18.3% decline over 1 year.
• Recent attention on Equitable Holdings has centered on its share price swings and how these moves compare with its fundamentals and capital return profile. This context has kept valuation in focus for investors who are weighing short term volatility against a longer term track record.
• On our model, Equitable Holdings currently records a valuation score of 6 out of 6. Next we will look at how different valuation approaches arrive at that view, before finishing with a more complete way to think about what the stock might be worth.

Approach 1: Equitable Holdings Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company might be worth by projecting its future cash flows and discounting them back to today’s value.

For Equitable Holdings, the model starts with last twelve months free cash flow of about $612.2 million, then projects how that cash flow could develop. Analysts provide estimates up to 2027, with free cash flow for that year assumed at $1.6 billion. Beyond that, Simply Wall St extrapolates cash flows out to 2035 using modest annual adjustments rather than analyst targets.

When those future cash flows are discounted back to today and allocated across shares, the DCF approach suggests an intrinsic value of about $100.75 per share. Compared with the recent share price of $39.78, this implies the shares trade at a 60.5% discount to this model’s estimate, which indicates the stock may be undervalued based on these assumptions.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Equitable Holdings is undervalued by 60.5%. Track this in your watchlist or portfolio, or discover 47 more high quality undervalued stocks.

Approach 2: Equitable Holdings Price vs Sales

For companies where sales are a more consistent metric than accounting earnings, the P/S ratio can be a useful way to think about value, because it relates the share price directly to the revenue the business generates.

What counts as a “normal” or “fair” P/S ratio usually reflects how quickly sales are expected to grow and how risky those sales are. Higher expected growth and lower perceived risk can justify a higher multiple, while slower growth or higher risk can point to a lower one.

Equitable Holdings currently trades on a P/S ratio of 0.96x. That sits below the Diversified Financial industry average P/S of 2.24x and also below the peer average of 1.16x. Simply Wall St’s Fair Ratio for Equitable Holdings is 1.87x. This is its proprietary estimate of what a reasonable P/S could be, given factors like the company’s growth profile, profit margins, industry, market cap and specific risks.

Compared with simple industry or peer comparisons, the Fair Ratio attempts to tailor the multiple to the company’s own characteristics rather than assuming all firms deserve similar pricing. Since the current 0.96x P/S is below the 1.87x Fair Ratio, the shares screen as undervalued on this measure.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your Equitable Holdings Narrative

Earlier we mentioned that there is an even better way to understand valuation. On Simply Wall St’s Community page you can build or follow a Narrative for Equitable Holdings, which is simply your story for the company tied directly to your own assumptions for future revenue, earnings and margins. These flow through to a fair value that you can compare with today’s price to help decide whether the stock is attractive for you. Narratives are updated automatically when new information like earnings, news or changes in analyst targets arrive. You can see in real time how views differ. For example, one Equitable Holdings Narrative might lean toward a higher fair value of about $77.00 based on stronger growth and profitability assumptions, while another might anchor closer to $58.00 with more cautious expectations. All of this sits inside an easy to use framework that lets millions of investors express and test their views using the same consistent structure.

Do you think there's more to the story for Equitable Holdings? 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.