ICL Group (ICL) Reaffirmed Guidance And Unveiled Elevate, Is It Undervalued?

ICL Group (NYSE:ICL) is back in focus after reporting second quarter 2026 results, outlining its Elevate cost program and confirming full year guidance, alongside a fresh dividend declaration and planned reorganization.

See our latest analysis for ICL Group.

ICL Group's recent earnings, dividend declaration and upcoming reorganization have coincided with a short term rebound, with a 7 day share price return of 4.94% and a 30 day share price return of 9.48%, although the 1 year total shareholder return is still down 12.10% and momentum from earlier in the year has faded.

If you are weighing ICL Group against other materials and resource exposures, this can be a good moment to see what else is moving in the sector through the 28 best rare earth metal stocks

After the recent bounce, ICL Group still trades at a sizable discount to one fair value estimate and below analyst targets. Is the market being too cautious about its earnings quality and Elevate plan, or is that gap warranted?

Preferred P/E of 22.5x on ICL Group: Is it justified?

ICL Group closed at $5.31, and based on a P/E of 22.5x, the stock screens as slightly expensive against its closest peer group average of 21.9x, while still looking cheaper than the broader US Chemicals industry at 29.4x. That gap between peer and industry benchmarks gives you a cleaner lens on whether the current rebound already prices in a lot of good news.

The P/E ratio compares the current share price to earnings per share and is often used for companies such as ICL Group that are already profitable. A higher P/E can sometimes point to the market expecting stronger earnings in future, while a lower P/E can signal more modest expectations or concerns about earnings quality.

In this case, the P/E of 22.5x sits slightly above the peer average of 21.9x, which fits with the comment that ICL is considered expensive compared to its immediate peers. At the same time, it is below the US Chemicals industry average of 29.4x, which suggests the stock is not being priced at the top end of sector expectations and could be seen as more moderate when you widen the comparison set.

Looking across the sector, that mix of a higher P/E than close peers and a lower P/E than the wider industry indicates the market is assigning ICL Group a mid range valuation. It costs a little more than similar companies in the peer group on an earnings basis, yet still sits meaningfully below the broader Chemicals industry, which may point to some relative caution but not outright optimism being priced in.

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

Result: Price-to-earnings of 22.5x (ABOUT RIGHT)

However, ICL Group still faces risks if the Elevate cost program disappoints or if demand in key fertilizer and industrial end markets weakens further.

Find out about the key risks to this ICL Group narrative.

Another view on ICL Group's value

While the current P/E of 22.5x makes ICL Group look only slightly expensive versus close peers, the SWS DCF model points in a different direction. At a share price of $5.31, it suggests fair value closer to $8.55, which implies the stock trades at a sizeable discount. This raises the question of whether the market is underestimating future cash flows or whether the DCF assumptions are too generous.

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 ICL Group 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 52 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

With mixed signals on ICL Group's valuation and outlook, it may be useful to review the numbers directly and compare them with the 1 key reward and 4 important warning signs

Looking for more investment ideas beyond ICL Group?

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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.

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