Northwest Natural Holding Company (NWN)
Valuation Overview•Is Northwest Natural Holding Company Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Moderate quality score of 49/100, reflecting stable operating margins and manageable leverage.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Average quality business weighed down by significant solvency concerns.
Wall Street is broadly bullish, projecting solid upside. This is paired with healthy capital returns, anchored by a strong, well-covered dividend yield.
NWN demonstrates adequate business quality with stable profitability. However, this is severely offset by a highly leveraged balance sheet (Debt/EBITDA > 4.0x) and elevated financial risk.
The company demonstrates solid revenue growth (7.5% 3Y CAGR) paired with stable bottom-line earnings. This growth is supported by elite operational efficiency, sustaining an impressive 31.3% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $490.4M | +11.8% | +7.5% | +10.8% | +5.9% | |
| EBITDA | $276.0M | — | +26.3% | — | — | |
| Net Income | $97.5M | +43.7% | +9.5% | — | +7.8% | |
| EPS (Diluted) | $2.38 | +36.5% | +2.9% | +3.6% | +3.5% | |
| Free Cash Flow | $2.5M | -178.1% | -41.4% | -31.8% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 42.3% | 36.5% | 36.1% | 37.0% |
| Operating Margin | 31.3% | 21.1% | 19.7% | 19.5% |
| Net Margin | 9.6% | 7.8% | 8.2% | 7.0% |
| FCF Margin | -25.9% | -20.9% | -19.3% | -11.7% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $2.40 | $2.33 | -2.9% | ||
| Q1'26 | $1.36 | $1.39 | +2.2% | ||
| Q4'25 | $-0.82 | $-0.73 | +11.0% | ||
| Q3'25 | $-0.07 | $0.01 | +114.3% | ||
| Q2'25 | $2.09 | $2.28 | +9.1% | ||
| Q1'25 | $1.42 | $1.41 | -0.7% | ||
| Q4'24 | $-0.79 | $-0.71 | +10.1% | ||
| Q3'24 | $-0.12 | $-0.07 | +41.7% |
Total return is +23.1% (1Y), outperforming the benchmark by +6.7%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +6.2% | +2.9% | — |
| 1Y | +23.1% | +6.7% | +4.8% |
| 3YCAGR | +10.0% | -9.5% | +13.9% |
| 5YCAGR | +3.0% | -8.6% | +18.7% |
| 10YCAGR | +1.2% | -12.5% | — |
The S&P 500 is at 31.5x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Northwest Natural Holding Company (NWN) valuation, health, and returns.
Northwest Natural Holding Company is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Cheap versus peers compared to industry peers. undervalued (implying +31.3% upside to DCF intrinsic value of $65.28)
Northwest Natural Holding Company has multiple valuation anchors: DCF Intrinsic Value: $65.28 | Peer Relative Fair Value: $63.76 | Wall Street Analyst Target: $55.25 (implying +13.6% upside). A convergence of these signals offers higher conviction.
Northwest Natural Holding Company displays fair financial health with a composite quality score of 49/100, supported by a Piotroski F-Score of 5/9, Return on Invested Capital (ROIC) of 8.1%.
Northwest Natural Holding Company pays a 3.9% dividend yield, covered by a 68% payout ratio with 24 years of growth, supplemented by a 0.0% buyback yield.
Northwest Natural Holding Company's current growth trajectory is Accelerating. The company achieved +11.8% 1Y revenue growth and +36.5% 1Y EPS growth, compared to its 3Y revenue CAGR of +7.5%.
Wall Street consensus is Hold based on 8 analysts, beating EPS expectations in 67% of recent quarters with a -1-quarter streak. The consensus price target represents a +13.6% change from current levels.
Investment risks for Northwest Natural Holding Company include: -14.3% 1-year max drawdown. Volatility risk is characterized by a beta of -0.21x.
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.