As of May 23, 2025, Hubbell Inc has a Discounted Cash Flow (DCF) derived fair value of $501.64 per share. With the current market price at $389.39, this represents a potential upside of 28.8%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $398.03 |
| DCF Fair Value (10-year) | $501.64 |
| Potential Upside (5-year) | 2.2% |
| Potential Upside (10-year) | 28.8% |
| Discount Rate (WACC) | 8.1% - 10.4% |
Revenue is projected to grow from $5628 million in 12-2024 to $9378 million by 12-2034, representing a compound annual growth rate of approximately 5.2%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 5628 | 5% |
| 12-2025 | 5492 | -2% |
| 12-2026 | 5924 | 8% |
| 12-2027 | 6213 | 5% |
| 12-2028 | 6746 | 9% |
| 12-2029 | 7027 | 4% |
| 12-2030 | 7499 | 7% |
| 12-2031 | 7939 | 6% |
| 12-2032 | 8370 | 5% |
| 12-2033 | 8789 | 5% |
| 12-2034 | 9378 | 7% |
Net profit margin is expected to improve from 14% in 12-2024 to 28% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 784 | 14% |
| 12-2025 | 914 | 17% |
| 12-2026 | 1132 | 19% |
| 12-2027 | 1333 | 21% |
| 12-2028 | 1597 | 24% |
| 12-2029 | 1813 | 26% |
| 12-2030 | 1964 | 26% |
| 12-2031 | 2111 | 27% |
| 12-2032 | 2259 | 27% |
| 12-2033 | 2406 | 27% |
| 12-2034 | 2604 | 28% |
with a 5-year average of $130 million. Projected CapEx is expected to maintain at approximately 3% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 142 |
| 12-2026 | 156 |
| 12-2027 | 163 |
| 12-2028 | 166 |
| 12-2029 | 167 |
| 12-2030 | 178 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 52 |
| Days Inventory | 83 |
| Days Payables | 56 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2025 | 1032 | 186 | 110 | (13) | 749 |
| 2026 | 1673 | 307 | 158 | 70 | 1138 |
| 2027 | 1939 | 362 | 165 | 29 | 1383 |
| 2028 | 2285 | 433 | 179 | 90 | 1582 |
| 2029 | 2564 | 492 | 187 | 36 | 1849 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 398.03 | 2.2% |
| 10-Year DCF (Growth) | 501.64 | 28.8% |
| 5-Year DCF (EBITDA) | 400.67 | 2.9% |
| 10-Year DCF (EBITDA) | 502.11 | 28.9% |
Is Hubbell Inc (HUBB) a buy or a sell? Hubbell Inc is definitely a buy. Based on our DCF analysis, Hubbell Inc (HUBB) appears to be significantly undervalued with upside potential of 28.8%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a strong buy at the current market price of $389.39.