Thinking about whether Prada’s current share price is a bargain? If you have ever wondered how much quality you are really getting for your money, you are in the right place.
Prada’s stock has seen a fair share of swings lately, rising 5.8% in the past week and 2.7% for the month. However, it is still down 25.3% year to date.
These moves have been accompanied by notable headlines, including renewed interest from luxury sector investors and speculation about evolving consumer demand in key global markets. Industry news has highlighted shifts in both the luxury retail landscape and Prada’s ability to adapt. Both of these factors help to explain recent market sentiment.
When we run Prada through our six standard valuation checks, it scores a 2 out of 6 for being undervalued. We will break down what that means for investors using familiar valuation tools, and show you an even more insightful way to think about value by the end of this article.
Prada scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
The Discounted Cash Flow (DCF) model estimates a company’s intrinsic value by projecting its future cash flows and discounting them to present-day value. This approach aims to capture how much future profits are really worth today, adjusting for time and risk.
For Prada, the latest data shows that its Free Cash Flow over the last twelve months was €933.8 Million. Analyst estimates suggest that, by the end of 2027, Prada’s Free Cash Flow will reach about €1.39 Billion. Simply Wall St then extends these projections for the next decade. By 2035, extrapolated estimates put Free Cash Flow at nearly €1.9 Billion. These medium-to-long-term projections form the basis for the valuation analysis.
Running this through the DCF model, Prada’s estimated intrinsic value per share comes in at HK$53.58. This suggests the stock is currently trading at a 12.4% discount relative to its fair value. In other words, the market price is below what the cash flows imply it should be.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Prada is undervalued by 12.4%. Track this in your watchlist or portfolio, or discover 879 more undervalued stocks based on cash flows.
1913 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 Prada.
The Price-to-Earnings (PE) ratio is widely used to value established, profitable companies like Prada. It tells investors how much they are paying for each unit of current earnings, and is especially helpful for comparing companies of similar size or within the same sector.
Growth prospects and risk profile play a major role in determining what a “normal” or fair PE ratio should be. Higher growth and lower risk typically justify a higher PE, while slower growth or higher risk might lead to a lower benchmark.
Prada currently trades at a PE ratio of 15.8x. For context, the average PE for other companies in the luxury industry is 10.1x, while Prada’s peer set trades at an average of 18.0x. This puts Prada’s valuation between these two key reference points.
Simply Wall St also produces a “Fair Ratio” for the company. It is an estimate of what Prada’s PE ratio should be when factoring in its earnings growth, profit margins, industry conditions, market cap, and company-specific risks. For Prada, the Fair Ratio is 11.9x. This proprietary measure is more comprehensive than a simple comparison to peers or the industry average because it considers the full picture of the company’s financial outlook, not just broad sector trends.
As Prada’s current PE of 15.8x is noticeably above its Fair Ratio of 11.9x, the stock appears somewhat overvalued based on this metric alone.
Result: OVERVALUED
SEHK:1913 PE Ratio as at Nov 2025
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1406 companies where insiders are betting big on explosive growth.
Earlier, we mentioned there is an even better way to think about value. Let’s introduce you to Narratives. A Narrative is a clear story you create about a company, blending your assumptions about its future—such as revenue, profit margins, and fair value estimates—with the events and changes you believe will shape those outcomes. Narratives connect what you know about a business to a financial forecast, making sense of how the company’s journey could translate into a fair price.
On Simply Wall St’s Community page, millions of investors are using Narratives as an easy, dynamic tool to clarify their investment decisions. Narratives empower you to decide when to buy or sell based on the gap between your estimated Fair Value and today’s market price. The best part? These stories automatically update as fresh news or earnings data are released, keeping your decisions relevant.
For Prada, one investor’s Narrative might emphasize brand innovation and digital expansion, leading to a bullish fair value target near HK$88.74. Another might focus on sector headwinds and competitive risks, arriving at a more cautious target around HK$45.03. With Narratives, your investment approach is no longer just about numbers but about your unique perspective, clearly tied to financial outcomes and always up to date.
Do you think there’s more to the story for Prada? Head over to our Community to see what others are saying!
SEHK:1913 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 1913.HK.
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