Curious if Elevance Health is now a bargain or still too pricey? You are not alone. Many investors are searching for clues about the company’s true value and long-term potential.
Despite a challenging year, Elevance Health’s stock recently gained 5.1% in the past week and is up 0.6% over the past month. However, it remains down 7.5% year-to-date and 15.4% over the last 12 months.
Shares have moved as the healthcare sector faces shifting regulations and market updates. Investor sentiment has rebounded after policy news and new partnerships were announced, prompting fresh questions about the risk and reward picture for Elevance Health going forward.
The company currently scores a 5 out of 6 on our undervaluation checks, putting it well above most of its peers. Next, we will look at what traditional valuation models suggest. Stick around as we introduce a more holistic way to judge if Elevance Health deserves a spot in your portfolio.
Elevance Health delivered -15.4% returns over the last year. See how this stacks up to the rest of the Healthcare industry.
A Discounted Cash Flow (DCF) model estimates a company’s value by projecting its future cash flows and discounting them back to today’s dollars. This approach aims to reveal what the business is truly worth based on its ability to generate cash over time.
For Elevance Health, the most recent reported Free Cash Flow stands at $3.58 billion. Analyst estimates extend out five years, with free cash flow expected to rise to $8.70 billion in 2029. Beyond that, projections are extrapolated by Simply Wall St and suggest continued growth over the next decade.
The DCF calculation puts Elevance Health’s estimated intrinsic value at $1,082.02 per share. At this time, the model indicates the stock trades at a 68.7% discount to this intrinsic value. In other words, the share price is significantly lower than what the company’s projected future cash flows might justify.
If the assumptions and projections hold true, Elevance Health appears deeply undervalued according to this model.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Elevance Health is undervalued by 68.7%. Track this in your watchlist or portfolio, or discover 920 more undervalued stocks based on cash flows.
ELV Discounted Cash Flow as at Nov 2025
Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Elevance Health.
For profitable companies like Elevance Health, the Price-to-Earnings (PE) ratio is a widely used valuation metric because it directly relates a company’s stock price to its earnings per share. This makes it especially useful for businesses with stable and predictable profits, as it reveals how much investors are willing to pay for each dollar of current earnings.
Growth expectations and risk both play a big role in determining what the “right” PE ratio should be. Companies expected to grow faster or with less risk usually command higher PE multiples, while lower-growth or riskier firms typically trade at lower ratios.
Currently, Elevance Health trades at a PE ratio of 13.6x. This is significantly lower than the healthcare industry average of 22.7x, as well as the peer average of 27.7x. At first glance, this could suggest undervaluation, but surface-level peer comparisons do not always tell the full story.
Simply Wall St’s proprietary Fair Ratio for Elevance Health is 32.6x. Unlike basic benchmarks, the Fair Ratio is tailored to Elevance Health’s own circumstances by taking into account growth outlook, risk factors, profit margins, industry dynamics, and overall market position. This approach aims to deliver a more accurate picture of what multiple is justified for the company instead of relying on broad averages that might miss important context.
With a Fair Ratio of 32.6x and an actual PE ratio of 13.6x, Elevance Health appears undervalued on this measure, suggesting the market may be overlooking its earnings power and long-term prospects.
Result: UNDERVALUED
NYSE:ELV PE Ratio as at Nov 2025
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1443 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 simply your story about Elevance Health. It is where you bring together your own view on the company’s prospects, including fair value, future revenue, earnings, and profit margins, to create a financial forecast with a real-world context. Narratives make investing more approachable by linking your view of a company’s business story to what you think it is worth, helping you move seamlessly from ideas to numbers to conclusions.
On Simply Wall St’s Community page, millions of investors use Narratives to decide when to buy or sell by quickly checking if their calculated Fair Value is above or below the current price, and updating their view as new information, like earnings or news, becomes available. For example, some investors believe Elevance Health should be worth $507 per share if Medicare Advantage and digital health initiatives contribute to growth, while others are more cautious, seeing fair value as low as $297 if cost pressures and Medicaid challenges persist. Narratives empower you to create, compare, and update your investment case as the story evolves.
Do you think there’s more to the story for Elevance Health? Head over to our Community to see what others are saying!
NYSE:ELV Community Fair Values as at Nov 2025
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 ELV.
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