MODEL VERDICT
The Honest Company, Inc. (HNST) — Relative Valuation
Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| Feb 28, 2026 | MODERATE | 0.63 | $2.80 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 43 analyst estimates | $1.86 | -33.6% | 20% | A- | Analyst Est. |
| Price / Free Cash Flow 38 industry peers | $2.82 | +0.7% | 15% | B+ | Peer Data |
| EV/FCF 39 industry peers | $3.77 | +34.6% | 7% | B | Model Driven |
| EV To Revenue 51 industry peers | $6.32 | +125.7% | 4% | B | Data |
| Price / Sales 51 industry peers | $4.60 | +64.3% | 3% | B | Model Driven |
| FCF Yield 39 industry peers | $2.94 | +5.0% | 1% | B | Data |
| Weighted Output Blended model output | $6.19 | +121.2% | 100% | 63 | SIGNIFICANTLY UNDERVALUED |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/FCF | 242.01 | 21.08 | 17.82 | 687.14 | 385.49 |
| P/TBV | 2.71 | 2.59 | 1.72 | 4.04 | 0.96 |
| P/B Ratio | 2.66 | 2.53 | 1.69 | 3.99 | 0.95 |
| P/S Ratio | 1.24 | 0.91 | 0.77 | 1.84 | 0.53 |
Based on our peer multiples analysis with 15 valuation metrics, the model estimates HNST's fair value at $6.19 vs the current price of $2.80, implying +121.2% upside potential. Model verdict: Significantly Undervalued. Confidence: 63/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $6.19 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $2.42 (P10) to $14.54 (P90), with a median of $6.45.
HNST's current P/E of -20.0x compares to the industry median of 29.3x (36 peers in the group). This represents a -168.3% discount to the industry. The historical average P/E is N/Ax over 0 years. Signal: Deep Discount.
9 analysts cover HNST with a consensus rating of Hold. The consensus price target is $3.00 (range: $3.00 — $3.00), implying +7.1% upside from the current price. Grade breakdown: Strong Buy (0), Buy (2), Hold (5), Sell (2), Strong Sell (0).
The model confidence score is 63/100, based on: data completeness (15), peer quality (25), historical depth (16), earnings stability (5), and model agreement (2). Cyclicality penalty: -0 points. The model shows moderate agreement across inputs.
The model flags several key risks: (1) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk data is not available for HNST.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.