Perrigo (PRGO) Could Be 13% Below Fair Value On Recovery Hopes
Recent share performance and what it might mean for Perrigo
Perrigo (PRGO) has attracted fresh attention after a strong move in the share price over the past month, with the stock up about 43% and about 38% over the past 3 months.
While Perrigo’s recent 30 day share price return of about 43% and 90 day share price return of about 38% point to building short term momentum, the stock’s 1 year total shareholder return, 3 year total shareholder return, and 5 year total shareholder return are all still significantly negative, which keeps the move in context.
Compare Perrigo’s sharp rebound with other stocks that screen well on value and quality by scanning our hand picked 50 high quality undervalued stocks.
Perrigo’s sharp bounce has closed some of the gap to analyst targets, yet the stock still trades at a large stated discount to one estimate of intrinsic value. Is most of the rerating already done, or is there meaningful upside left as the valuation section shows next?
Most Popular Narrative: 12.5% Undervalued
Perrigo closed at $14.43, while the most followed narrative anchors on a fair value of $16.50, which frames the recent rally in a different light.
Recent new business wins in US store-brand OTC have outpaced distribution losses for the first time since the 2024 reset, with net new contract gains expected to add $75M+ to sales in the second half, directly supporting a step-change in revenue growth and operating income.
Want to understand why this fair value leans on steady sales, margin repair and a rich future earnings multiple? The narrative rests on modest top line assumptions, a swing from heavy losses to profit, and a premium P/E that is more typical of fast growing sectors than a consumer health stock.
Result: Fair Value of $16.50 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, the Perrigo story can change quickly if the recovery of infant formula underwhelms or if ongoing goodwill impairments and category softness signal deeper pressure on earnings power.
Find out about the key risks to this Perrigo narrative.
Next Steps
With mixed sentiment around Perrigo’s risks and rewards, it makes sense to move quickly and test the narrative against the underlying data yourself by reviewing the 3 key rewards and 1 important warning sign.
Looking for more ideas beyond Perrigo?
If you stop at Perrigo, you might miss other opportunities that fit your style. Put a few minutes into broadening your watchlist and your future self could be thankful.
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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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