• If you are wondering whether Johnson Controls International at around US$139 per share still offers value, the key question is how that price compares with what the business might be worth.
• The stock has been volatile recently, with a 4.6% decline over the last 7 days, a 4.6% gain over the past month, and returns of 13.9% year to date, 54.7% over 1 year, 137.8% over 3 years and 139.6% over 5 years.
• Recent headlines have focused on Johnson Controls International as investors reassess large cap industrials and their exposure to building efficiency, smart infrastructure and automation themes. This shift in attention provides useful context for the strong multi year share price performance and the short term pullback.
• Despite that history, Johnson Controls International currently scores 0/6 on Simply Wall St's valuation checks, as shown in its valuation score. The rest of this article will walk through traditional valuation methods and then conclude with a different way of thinking about value that ties the numbers back to the wider investment story.

Johnson Controls International scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Johnson Controls International Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model projects a company’s future cash flows and then discounts them back to today’s value to estimate what the business might be worth per share right now.

For Johnson Controls International, 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 $1.28b, and analysts and internal estimates project free cash flow reaching around $4.40b by 2030. Simply Wall St uses analyst forecasts where available and then extends those projections out to 10 years, discounting each year’s cash flow back to today using its own assumptions.

On this basis, the DCF model arrives at an estimated intrinsic value of about $104.29 per share. Compared with the current share price of around $139, this implies the stock is about 33.5% above the DCF estimate, which points to Johnson Controls International trading rich against this specific cash flow model.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Johnson Controls International may be overvalued by 33.5%. Discover 51 high quality undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Johnson Controls International Price vs Earnings

For profitable companies, the P/E ratio is a useful yardstick because it links what you pay for each share directly to the earnings that each share generates. It gives you a quick sense of how much the market is willing to pay for today’s earnings.

What counts as a “normal” or “fair” P/E depends on how investors see the company’s growth potential and risk profile. Higher expected growth or lower perceived risk is usually associated with a higher P/E, while slower expected growth or higher risk often goes with a lower P/E.

Johnson Controls International trades on a P/E of about 41.46x compared with the Building industry average of roughly 21.77x and a peer group average of about 29.84x. Simply Wall St’s Fair Ratio for Johnson Controls International is 38.22x, which is its proprietary view of what a reasonable P/E might be after factoring in the company’s earnings growth characteristics, profit margins, industry, market cap and specific risks.

This Fair Ratio can be more informative than a simple comparison with peers or the broad industry because it adjusts for company specific traits rather than assuming all stocks deserve similar multiples. With the current P/E above the Fair Ratio, Johnson Controls International appears expensive on this measure.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Johnson Controls International Narrative

Earlier it was mentioned that there is an even better way to understand valuation. Narratives are introduced here as a simple way for you to attach your own story about Johnson Controls International to the numbers by linking your assumptions for future revenue, earnings and margins to a fair value estimate. This can then be compared with the current share price to help frame investment decisions.

On Simply Wall St, Narratives live inside the Community page and are used by millions of investors as an accessible tool that turns a company thesis into a full forecast and fair value. These then update automatically when fresh information like news, earnings or guidance is added to the platform.

For Johnson Controls International, one investor might align with the more cautious Narrative that points to a fair value around US$115.49, while another might agree with a more optimistic Narrative closer to US$173.00. By setting these side by side with the current price you can quickly see which story best matches your expectations and assess whether the stock appears stretched or reasonable under your chosen scenario.

For Johnson Controls International, here are previews of two leading Johnson Controls International Narratives:

Fair value: US$173.00

Implied discount to this fair value: about 19.5% below the narrative fair value based on the recent share price of US$139.25

Revenue growth assumption: 7.67% a year

• Analysts in this bullish camp describe operational excellence and wider adoption of Lean practices as key drivers for higher margins and earnings power over time.
• The thesis focuses on global demand for smart, sustainable building solutions and data center cooling, with Johnson Controls International described as a key supplier in these segments.
• The narrative assumes strong cash generation supports ongoing buybacks and selective M&A, which together could lift earnings per share and support the higher fair value.

Fair value: US$115.49

Implied premium to this fair value: about 20.6% above the narrative fair value based on the recent share price of US$139.25

Revenue growth assumption: 5.56% a year

• This more cautious narrative highlights reliance on mature markets, higher input costs and pricing pressure as potential headwinds for long term revenue growth and margins.
• It also flags competition from new technology focused entrants and the risk that building and HVAC solutions become more commoditized over time.
• Under this view, even with some improvement in earnings, the current share price is described as already embedding optimistic assumptions, which leads to a fair value below the market price.

Do you think there's more to the story for Johnson Controls International? 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.