If you are following Manhattan Associates, you might be asking yourself, “Is this the time to buy, hold or move on?” It is a fair question given how this stock has kept investors guessing lately. After a remarkable run over the past several years, the stock is still up 53.2% over three years and a notable 113.1% across five years. The more recent performance has been choppy. Shares have dropped 2.0% in just the last week, 9.6% over the past month, and the year-to-date slide sits at 26.8%. That is quite a swing from the big gains seen not too long ago.
Moves like this often reflect changing perceptions about the risks or the outlook for a company. In the case of Manhattan Associates, the broader software sector has seen some sector rotation as investors debate how much further some growth names can run. While there has not been a headline event directly tied to the latest dip, this shift in sentiment has pushed the valuation of the stock firmly back into the spotlight.
So, how undervalued might Manhattan Associates be right now? Based on a standard valuation process that checks for underpricing across six different criteria, it only scores a 1 out of 6. That hints at a business that is still priced for a fair bit of optimism, or perhaps one where the story is more nuanced than the simple numbers suggest.
Next, we will dig into exactly how these valuation methods work, where Manhattan Associates measures up, and why understanding what truly drives value might be even more important.
Manhattan Associates scores just 1/6 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 back to today’s dollars. This process reflects what those future earnings are truly worth right now.
For Manhattan Associates, the most recent reported Free Cash Flow stands at $308 million. Analyst projections anticipate steady growth, with estimates rising annually and Simply Wall St extrapolating those figures through 2035. By 2029, Free Cash Flow is expected to reach $665.9 million. Beyond that, optimistic but more speculative forecasts have the company potentially generating over $1 billion in annual Free Cash Flow within the next decade.
Using this method, the estimated fair value of Manhattan Associates stock is $218.50 per share. That is approximately 9.9% higher than the stock’s recent trading price, suggesting the shares are trading at a small discount based on these long-term cash flow assumptions.
Story Continues
In summary, while the DCF model suggests there may be a modest opportunity here, both the discount and the uncertainty around long-term projections warrant a measured view.
Result: ABOUT RIGHT
MANH Discounted Cash Flow as at Oct 2025
Simply Wall St performs a valuation analysis on every stock in the world every day (check out Manhattan Associates’s valuation analysis). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes.
The Price-to-Earnings (PE) ratio is especially relevant when valuing profitable companies like Manhattan Associates because it directly connects the company’s earnings power to its stock price. PE ratios help investors gauge how much the market is willing to pay for each dollar of earnings, making it a key yardstick for growth-oriented technology firms.
What constitutes a “fair” PE ratio varies depending on growth expectations, industry trends, and risk. Higher PE ratios are often seen in companies with faster growth or fewer risks, while more mature or riskier businesses are priced lower. For Manhattan Associates, the current PE ratio stands at 53.8x, which is notably higher than the software industry average of 34.9x and above the average of direct peers at 35.5x.
To bring more context, Simply Wall St’s proprietary “Fair Ratio” methodology goes beyond simple peer or industry comparisons. This Fair Ratio blends in factors like the company’s earnings growth, profit margin, risk profile, industry classification, and overall market capitalization. For Manhattan Associates, the Fair Ratio is 32.0x. This means the company’s current valuation is significantly above what would be considered “fair” based on its specific fundamentals and outlook.
Comparing the 53.8x PE ratio to the Fair Ratio of 32.0x suggests Manhattan Associates stock is currently trading well above a rational valuation for its profile.
Result: OVERVALUED
NasdaqGS:MANH PE Ratio as at Oct 2025
PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.
Earlier, we mentioned there’s an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is your personal, reasoned story about a company and its future, tying together your perspective on its business drivers, financial forecasts, and ultimately what you think its shares are worth.
Unlike static valuation models, Narratives link the company’s story—why you believe in its direction, market position, or risks—to a set of estimated future numbers such as revenue, earnings, and margins, and then to a calculated fair value. Narratives are designed to make complex valuation assumptions accessible and actionable, turning your outlook into a clear, numbers-driven investment thesis.
This easy-to-use, dynamic tool is available right now on Simply Wall St’s Community page, where millions of investors are actively creating and sharing their own Narratives. Narratives help you cut through noise by connecting your outlook to hard data, then comparing your fair value against the share price to highlight buy or sell opportunities. Plus, your Narrative updates automatically as new news or earnings are announced, so your view stays relevant.
For Manhattan Associates, some investors might build a Narrative around rapid cloud adoption and AI integration, seeing a fair value as high as $250 per share. Others may focus on risks like slow migration or margin pressure and arrive at a much lower target of $205. Your Narrative, not just consensus, can drive your next smart decision.
Do you think there’s more to the story for Manhattan Associates? Create your own Narrative to let the Community know!
NasdaqGS:MANH Community Fair Values as at Oct 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 MANH.
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