A Look At Stewards (OTCPK:SWRD) Valuation After John Bode Joins As Audit Committee Chair

Stewards (SWRD) has drawn fresh attention after appointing John Bode as board member and audit committee chair, placing his public-company finance and transformation background at the center of its governance and financial oversight.

See our latest analysis for Stewards.

The latest board appointment comes as Stewards’ share price trades at US$5.90, with a 1 day share price return of 9.26% and 90 day share price return of 48.24%. The 1 year total shareholder return is very large, which may indicate ongoing momentum rather than a short term spike.

If this kind of governance shift has your attention, it could be a good moment to broaden your search and check out fast growing stocks with high insider ownership.

With Stewards trading at US$5.90 and recent returns already strong, the key question for you is whether the current price underestimates the company’s governance shift or whether the market is already pricing in future growth.

Price to Book of 51.1x: Is it justified?

Stewards last closed at US$5.90 and is trading on a P/B of 51.1x, which is well above both peers and the wider US Diversified Financial industry.

P/B compares the market value of the company to its book value, so a 51.1x reading indicates that investors are paying a high premium over the net assets on the balance sheet.

For a business that is currently unprofitable, this kind of premium usually suggests that the market is assigning significant value to future potential rather than current profitability or asset backing.

The gap is notable, with Stewards’ 51.1x P/B far above the industry average of 1.4x and also well above its peer average of 1x. This comparison highlights how stretched this valuation appears next to similar companies.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-book of 51.1x (OVERVALUED)

However, you also need to weigh Stewards’ loss of US$17.72m against its very high 51.1x P/B, because weaker profitability or funding demand could quickly pressure sentiment.

Find out about the key risks to this Stewards narrative.

Another View: Our DCF Model Flags a Big Gap

While the 51.1x P/B points to an expensive stock, our DCF model goes further. It estimates fair value at US$0.42 per share compared with the current US$5.90. This comparison implies Stewards is significantly overvalued. The question for you is what could close that kind of gap.

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Stewards for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 878 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Stewards Narrative

If you see the numbers differently or simply want to test your own view against the data, you can build a full Stewards narrative in minutes by starting with Do it your way.

A great starting point for your Stewards research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If Stewards has sharpened your thinking, do not stop there. Broaden your watchlist now so you do not miss other opportunities shaping the market.

• Target potential bargains by scanning these 878 undervalued stocks based on cash flows that may be trading below what their cash flows imply.
• Spot emerging themes in digital assets with these 79 cryptocurrency and blockchain stocks that are tied to blockchain and cryptocurrency trends.
• Build a cash flow and income mix by reviewing these 14 dividend stocks with yields > 3% offering yields above 3%.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com