Evaluating Qnity Electronics (Q) After A Strong Multi‑Month Share Price Run
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Qnity Electronics (Q) has been drawing attention after a 3% move in the latest session, capping a month where the stock returned about 20% and roughly 34% over the past 3 months.
The company reports annual revenue of US$4,665.0 and net income of US$805.0, with annual revenue growth of 6.0% and net income growth of 9.4%. Qnity Electronics operates in the semiconductor materials and solutions space.
That 2.9% 1 day share price return builds on Qnity Electronics’ recent momentum, with a 7 day share price return of 13.7% and a year to date share price return of 31.4%. This suggests investors are currently reassessing its growth and risk profile around US$111.69 per share.
If this move in semiconductors has your attention, it could be a good moment to see what else is gaining interest through our screener of 34 AI infrastructure stocks.
With Qnity Electronics now trading around US$111.69, recent gains and an intrinsic value estimate that sits below the share price raise a key question: are you looking at a potential entry point, or is the market already pricing in future growth?
On a P/E of 29.1x at the last close of $111.69, Qnity Electronics is priced below both the US semiconductor industry average of 43.4x and a peer average of 60.1x. This points to a lower earnings multiple than many comparable names.
The P/E ratio compares the share price to earnings per share, so it reflects how much investors are paying today for each dollar of current earnings. For a company like Qnity Electronics, operating across semiconductor technologies and interconnect solutions, this multiple gives a quick sense of how the market is weighing its current profit profile against listed peers in the same space.
Qnity Electronics is described as having high quality earnings and its earnings grew by 24.6% over the past year, while current net profit margins of 17.3% sit above last year’s 15.2%. Set against that backdrop, a P/E that is lower than both the industry and peer averages suggests the market is assigning a more modest earnings multiple relative to many semiconductor names, given these profitability metrics.
Compared with the US semiconductor industry average P/E of 43.4x and a peer average of 60.1x, the 29.1x multiple stands out as meaningfully lower. There is a clear gap in how the market is currently valuing Qnity Electronics’ earnings against similar businesses.
However, you still have to weigh risks, such as the share price sitting above the US$109.11 analyst target and an intrinsic value estimate that sits well below today’s level.
The earnings-based P/E picture looks relatively reasonable, but our DCF model offers a different perspective. At $111.69, Qnity Electronics is trading well above an estimated future cash flow value of $58.84, which points to a stock price that sits at a premium to that cash flow view.
For you as an investor, that gap means there may be less room for error if future cash flows end up closer to the model. It raises a simple question: are you comfortable paying nearly double what our cash flow estimate suggests, or would you prefer a wider margin of safety?
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Qnity Electronics for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 53 high quality undervalued stocks. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.
If you look at the numbers and reach a different view, or simply prefer to test your own assumptions against the data, you can build a complete narrative in just a few minutes: Do it your way.
A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Qnity Electronics.
If Qnity Electronics has you thinking more seriously about where you put your capital, do not stop at one name. Broaden your watchlist while conditions still look interesting.
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.
