T. Rowe Price Group, Inc. (TROW)
Valuation Overview•Is T. Rowe Price Group, Inc. Overvalued or Undervalued?
Trading at a discount to intrinsic cash flow value, implying pessimistic long-term market expectations.
High-quality fundamentals with a strong composite quality score of 82/100, backed by robust profitability and solvency.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Elite compounder with fortress-level fundamentals across every core pillar.
Wall Street sentiment is generally neutral. This outlook is strongly supported by highly attractive capital returns, driven by a balanced mix of reliable dividends and share buybacks.
TROW exhibits elite business quality, driven by exceptional capital efficiency and highly lucrative margins. This is backed by a fortress balance sheet, holding significant net cash ($2.5B) and minimal debt risk.
The company maintains stable top-line performance paired with robust earnings compounding (11.3% EPS 3Y CAGR). This growth is supported by elite operational efficiency, sustaining an impressive 30.2% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $1.9B | +3.1% | — | — | +5.7% | |
| EBITDA | $712.2M | — | -4.6% | — | — | |
| Net Income | $498.2M | -0.6% | +10.2% | — | +5.5% | |
| EPS (Diluted) | $2.23 | +1.1% | +11.3% | -1.5% | +7.2% | |
| Free Cash Flow | $892.0M | +17.2% | -11.3% | -2.8% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 69.1% | 54.7% | 56.0% | 56.7% |
| Operating Margin | 30.2% | 31.2% | 35.7% | 39.3% |
| Net Margin | 28.3% | 28.6% | 30.0% | 32.0% |
| FCF Margin | 31.6% | 17.4% | 25.3% | 20.6% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $2.33 | $2.52 | +8.2% | ||
| Q1'26 | $2.46 | $2.44 | -0.8% | ||
| Q4'25 | $2.54 | $2.81 | +10.6% | ||
| Q3'25 | $2.15 | $2.24 | +4.2% | ||
| Q2'25 | $2.13 | $2.23 | +4.7% | ||
| Q1'25 | $2.20 | $2.12 | -3.6% | ||
| Q4'24 | $2.33 | $2.57 | +10.3% | ||
| Q3'24 | $2.27 | $2.26 | -0.4% |
Total return is +22.4% (1Y), lagging the benchmark by -2.6%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +5.4% | -3.9% | — |
| 1Y | +22.4% | -2.6% | +5.6% |
| 3YCAGR | +3.0% | -16.4% | +13.4% |
| 5YCAGR | -6.6% | -19.3% | +14.5% |
| 10YCAGR | +7.6% | -5.9% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about T. Rowe Price Group, Inc. (TROW) valuation, health, and returns.
T. Rowe Price Group, Inc. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Fair versus peers compared to industry peers. undervalued (implying +42.7% upside to DCF intrinsic value of $153.61)
T. Rowe Price Group, Inc. has multiple valuation anchors: DCF Intrinsic Value: $153.61 | Peer Relative Fair Value: $113.79 | Wall Street Analyst Target: $102.60 (implying -4.7% upside). A convergence of these signals offers higher conviction.
T. Rowe Price Group, Inc. displays excellent financial health with a composite quality score of 82/100, supported by a Piotroski F-Score of 4/9, Return on Invested Capital (ROIC) of 13.3%.
T. Rowe Price Group, Inc. pays a 4.7% dividend yield, covered by a 55% payout ratio with 38 years of growth, supplemented by a 2.7% buyback yield.
T. Rowe Price Group, Inc.'s current growth trajectory is Decelerating. The company achieved +3.1% 1Y revenue growth and +1.1% 1Y EPS growth, compared to its 3Y revenue CAGR of N/A.
Wall Street consensus is Hold based on 38 analysts, beating EPS expectations in 75% of recent quarters with a 1-quarter streak. The consensus price target represents a -4.7% change from current levels.
Investment risks for T. Rowe Price Group, Inc. include: -22.7% 1-year max drawdown. Volatility risk is characterized by a beta of 0.98x.
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.