Does IESC’s Recent Pullback Signal a New Opportunity for Investors in 2025?
October 11, 2025
Wondering what to make of IES Holdings at this stage? If you have been watching its remarkable run, it is no surprise. Over the last three years alone, IES Holdings has soared an eye-popping 1,115.7%, and its five-year gains clock in at 856.8%. Even year-to-date, the stock is up an impressive 72.4%. That kind of multi-year return is enough to catch any investor’s eye. However, recent weeks have shown that even high flyers can hit turbulence. The stock dipped 5.6% in the past week and is off 5.1% over the last month, raising the usual questions about whether we are looking at healthy profit-taking or the start of a longer cooldown.
Market watchers have not pointed to any major news events causing the latest pullback, but shifts in sentiment and broader sector moves have clearly introduced a bit more risk perception into the mix. Now, with IES Holdings posting a compelling value score of 4 out of 6, meaning it is undervalued on four separate metrics, many investors are double-checking whether there is still room to run or if the easy gains are in the rearview mirror.
To get to the bottom of this, it makes sense to explore the classic ways analysts measure value and why those traditional number-crunching methods might only tell part of the story. Let’s dive into the core valuation checks for IES Holdings, keeping an eye out for an even more insightful way to gauge its worth by the end of this article.
The Discounted Cash Flow, or DCF, model estimates a company’s value by projecting its future cash flows and discounting them back to today’s dollars. For IES Holdings, this means analysts look at how much cash the company is expected to generate in upcoming years and then apply a discount to reflect the time value of money.
Currently, IES Holdings is producing annual free cash flow of $203 million. Analysts have provided forecasts out to 2029, expecting free cash flow to more than double and reach about $407 million in five years. Beyond those years, projections are carried further based on assumed growth rates. These cash flow estimates are then combined to calculate an intrinsic value for the stock.
According to this DCF analysis, IES Holdings has an estimated intrinsic value of $411 per share. Since this value reflects a 12.0% discount to the current market price, the model suggests the stock remains undervalued at present levels.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests IES Holdings is undervalued by 12.0%. Track this in your watchlist or portfolio, or discover more undervalued stocks.
The price-to-earnings (PE) ratio is a go-to metric for valuing profitable companies like IES Holdings. Since PE compares a company’s current share price against its earnings per share, it offers a straightforward way to see how the market values current profits. Investors often look for a higher PE where there is stronger expected growth and lower risk. Conversely, a lower PE might suggest slower growth or higher uncertainty, so what is “fair” depends on the company’s outlook and sector dynamics.
IES Holdings currently trades at a PE ratio of 27.1x. This is below the Construction industry’s average PE of 35.6x, and it is also lower than the broader peer average of 38.9x. While these figures suggest IES Holdings is valued more conservatively than its industry counterparts, it is important to consider factors beyond these simple comparisons.
This is where Simply Wall St’s proprietary Fair Ratio comes in. The Fair Ratio is a forward-looking multiple that incorporates factors such as the company’s growth prospects, risk, profit margins, market cap, and its unique industry landscape. For IES Holdings, the Fair Ratio stands at 43.2x. Unlike basic industry or peer comparisons, the Fair Ratio is tailored to the specific circumstances of each business, offering a more insightful benchmark for what the company “should” be trading at in today’s market.
Comparing IES Holdings’ actual PE of 27.1x to its Fair Ratio of 43.2x, the stock is currently undervalued relative to where those combined fundamentals might support it trading.
Result: UNDERVALUED
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.
Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is a user-driven story that connects your perspective on a company with the numbers behind it, including your own assumptions for fair value, future revenue, earnings, and margins. Narratives take investing beyond static metrics by linking a company’s story to a dynamic financial forecast, which then translates into a fair value estimate tailored to what you believe about the business.
This approach is designed to be simple and accessible for everyone and can be found on Simply Wall St’s Community page, where millions of investors are already using Narratives to inform their decisions. By comparing your Narrative’s Fair Value with the current share Price, you get instant clarity on whether it may be the right time to buy or sell. Because Narratives update automatically with fresh news or earnings, your thinking stays relevant. For example, when it comes to IES Holdings, some investors have crafted Narratives suggesting a much higher fair value based on aggressive growth forecasts, while others are more conservative, showing lower fair values because of risks they perceive.
Do you think there’s more to the story for IES Holdings? Create your own Narrative to let the Community know!
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.
Companies discussed in this article include IESC.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
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