Forward P/E vs. History and Peers
Based on the latest price action (HIL closed around $30 – $32 per share) and the consensus 2025‑2026 earnings estimate of roughly $0.60 – $0.65 per share (adjusted EPS ≈ $0.51 for Q3 and a modest growth outlook), the implied forward P/E sits in the mid‑40s (≈ 45×). Hillenbrand has historically traded in the 15‑20× range on a forward basis over the past five years, so the current multiple is roughly double its historical average. Compared with peer manufacturers such as Ametek (AEM), Flowserve (FLS), and Wabtec (WAB), which are averaging 21‑28× forward P/E, Hillenbrand is considerably more expensive relative to earnings expectations.
Trading Implications
The elevated forward P/E signals that the market has priced in a strong turnaround despite the 24 % revenue decline and a 40 % drop in adjusted EPS. If the company fails to deliver the anticipated turnaround (e.g., achieving the $30 M cost‑synergy target and reversing revenue decline), the stock is vulnerable to a re‑rating back toward historical multiples, implying a potential price correction of 10‑15 % from current levels. From a technical standpoint, the stock is holding just above a 50‑day moving average but has broken down from a short‑term bullish flag; the next major resistance is near $34‑$35, while support sits near $28. Given the valuation premium, a cautious short‑to‑neutral stance is advisable—consider a modest short position or a protective put if you already hold the stock, while monitoring earnings guidance and any forward‑looking commentary on margin recovery and the $30 M synergy execution.