Valaris Limited (VAL)
Valuation Overview•Is Valaris Limited Overvalued or Undervalued?
Trading at a discount compared to peers, but the underlying intrinsic cash flows struggle to support the current price.
Moderate quality score of 64/100, reflecting stable operating margins and manageable leverage.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Solid fundamental quality, though profitability presents a headwind.
Wall Street is highly bullish, projecting significant upside. However, capital return yields remain modest, driven predominantly by aggressive share repurchases.
Returns capital exclusively via buybacks — no active dividend
VAL demonstrates adequate business quality with stable profitability. This is paired with a moderately leveraged but stable balance sheet.
The company demonstrates solid revenue growth (13.9% 3Y CAGR) paired with highly explosive earnings growth (81.2% EPS 3Y CAGR). The company maintains healthy operational efficiency with a 15.5% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $465.4M | +0.3% | +13.9% | +10.7% | -5.3% | |
| EBITDA | -$2.8M | — | +71.0% | — | — | |
| Net Income | -$16.4M | +163.2% | +77.2% | — | — | |
| EPS (Diluted) | $-0.24 | +170.7% | +81.2% | — | — | |
| Free Cash Flow | -$25.9M | +303.3% | — | — | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 22.3% | 21.3% | 18.2% | 21.1% |
| Operating Margin | 15.5% | 12.9% | -6.3% | -35.6% |
| Net Margin | 45.4% | 35.3% | -49.6% | -62.0% |
| FCF Margin | 5.3% | -6.6% | -7.0% | -10.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $-0.05 | $-0.24 | -380.0% | ||
| Q1'26 | $0.51 | $0.79 | +54.9% | ||
| Q4'25 | $1.00 | $2.65 | +165.0% | ||
| Q3'25 | $1.16 | $1.61 | +38.8% | ||
| Q2'25 | $1.10 | $-0.53 | -148.2% | ||
| Q1'25 | $1.20 | $1.88 | +56.7% | ||
| Q4'24 | $1.04 | $0.88 | -15.4% | ||
| Q3'24 | $0.71 | $2.03 | +185.9% |
Total return is +71.8% (1Y), outperforming the benchmark by +46.8%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +50.6% | +41.3% | — |
| 1Y | +71.8% | +46.8% | — |
| 3YCAGR | +11.3% | -6.1% | — |
| 5YCAGR | +24.1% | +12.8% | — |
| 10YCAGR | +13.0% | 0.0% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Valaris Limited (VAL) valuation, health, and returns.
Valaris Limited is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. overvalued (implying -26.6% downside from DCF intrinsic value of $57.64)
Valaris Limited has multiple valuation anchors: DCF Intrinsic Value: $57.64 | Peer Relative Fair Value: $143.24 | Wall Street Analyst Target: $96.00 (implying +22.2% upside). A convergence of these signals offers higher conviction.
Valaris Limited displays good financial health with a composite quality score of 64/100, supported by a Altman Z-Score of 2.7 (grey zone), Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of 10.9%.
Valaris Limited returns capital via buybacks instead of dividends, carrying a 1.8% buyback yield and reducing outstanding shares by -2.7% in the last 12 months.
Valaris Limited's current growth trajectory is Decelerating. The company achieved +0.3% 1Y revenue growth and +170.7% 1Y EPS growth, compared to its 3Y revenue CAGR of +13.9%.
Wall Street consensus is Hold based on 54 analysts, beating EPS expectations in 75% of recent quarters with a -1-quarter streak. The consensus price target represents a +22.2% change from current levels.
Investment risks for Valaris Limited include: -30.7% 1-year max drawdown. Volatility risk is characterized by a beta of 0.89x.
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.