NatWest Group plc (NWG)
Valuation Overview•Is NatWest Group plc Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Moderate quality score of 56/100, reflecting stable operating margins and manageable leverage.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Average quality business weighed down by significant solvency concerns.
Wall Street is broadly bullish, projecting solid upside. This outlook is strongly supported by highly attractive capital returns, driven by a balanced mix of reliable dividends and share buybacks.
NWG demonstrates adequate business quality with stable profitability. This is backed by a fortress balance sheet, holding significant net cash ($13.5B) and minimal debt risk.
The company maintains stable top-line performance paired with highly explosive earnings growth (25.7% EPS 3Y CAGR). This growth is supported by elite operational efficiency, sustaining an impressive 26.2% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $7.4B | +3.2% | — | — | +6.2% | |
| EBITDA | $2.2B | — | +14.1% | — | — | |
| Net Income | $1.5B | +21.4% | +17.6% | — | — | |
| EPS (Diluted) | $0.68 | +27.4% | +25.7% | — | — | |
| Free Cash Flow | $0.00 | +734.3% | — | -27.4% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 56.3% | 55.8% | 67.2% | 75.0% |
| Operating Margin | 26.2% | 24.3% | 27.3% | 16.8% |
| Net Margin | 19.8% | 18.4% | 20.9% | 11.4% |
| FCF Margin | — | -18.2% | 22.0% | 52.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.44 | $0.48 | +9.1% | ||
| Q1'26 | $0.38 | $0.46 | +21.1% | ||
| Q4'25 | $0.42 | $0.53 | +26.9% | ||
| Q3'25 | $0.37 | $0.41 | +12.3% | ||
| Q2'25 | $0.34 | $0.39 | +13.6% | ||
| Q1'25 | $0.26 | $0.37 | +41.8% | ||
| Q4'24 | $0.31 | $0.36 | +17.6% | ||
| Q3'24 | $0.25 | $0.35 | +42.7% |
Total return is +24.5% (1Y), lagging the benchmark by -0.5%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | -2.4% | -11.7% | — |
| 1Y | +24.5% | -0.5% | +6.2% |
| 3YCAGR | +44.1% | +24.6% | +31.5% |
| 5YCAGR | +26.9% | +13.8% | +49.1% |
| 10YCAGR | +10.8% | -2.1% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about NatWest Group plc (NWG) valuation, health, and returns.
NatWest Group plc is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +104.3% upside to DCF intrinsic value of $34.26)
NatWest Group plc has multiple valuation anchors: DCF Intrinsic Value: $34.26 | Peer Relative Fair Value: $32.93 | Wall Street Analyst Target: $18.20 (implying +8.5% upside). A convergence of these signals offers higher conviction.
NatWest Group plc displays fair financial health with a composite quality score of 56/100, supported by a Piotroski F-Score of 7/9, Return on Invested Capital (ROIC) of 5.3%.
NatWest Group plc pays a 9.2% dividend yield, covered by a 41% payout ratio with 1 years of growth, supplemented by a 10.1% buyback yield.
NatWest Group plc's current growth trajectory is Decelerating. The company achieved +3.2% 1Y revenue growth and +27.4% 1Y EPS growth, compared to its 3Y revenue CAGR of N/A.
Wall Street consensus is Buy based on 6 analysts, beating EPS expectations in 92% of recent quarters with a 11-quarter streak. The consensus price target represents a +8.5% change from current levels.
Investment risks for NatWest Group plc include: -27.2% 1-year max drawdown, high beta (1.36x market volatility). Volatility risk is characterized by a beta of 1.36x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.