Severn Trent (SVT.L)
Utilities · LSE · UK
Fundamentals
Valuation and ratings
Severn Trent trades at £29.80, which is 59% below the £47.35 our discounted cash flow model puts on the business. On that measure alone it screens as undervalued, though a DCF is an argument rather than a measurement, and the market is frequently right about why something is cheap.
Our moat model scores it 51 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 24.1 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Severn Trent
Severn Trent PLC provides water and wastewater services in the United Kingdom. It operates in two segments, Regulated Water and Wastewater, and Infrastructure Services. It offers water and wastewater services. The company also generates renewable energy through solar, wind, hydro, and crop digestion, as well as through anaerobic digestion of sewage sludge and food waste. In addition, it engages in property development and the management of the sale of surplus land. The company was founded in 1974 and is headquartered in Coventry, the United Kingdom.
SVT.L passes 5 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Common questions
Is Severn Trent (SVT.L) undervalued?
Against our discounted cash flow estimate of £47.35, SVT.L at £29.80 is 59% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is SVT.L's P/E ratio?
SVT.L trades at 24.1 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.