XeroASX:XRO +1.43%81 EV-to-FCF is 29.39 as of Jul. 03, 2026, which is 71% below its 10-year median of 102.09. GuruFocus rates ASX:XRO with a GF Score™ of 81/100 and a GF Value™ of A$196.18 (Possible Value Trap). The stock has 7 warning signs investors should review. Among 1,589 Software companies, Xero ranks worse than 74.26% on this metric.
EV-to-FCF is calculated as enterprise value divided by its free cash flow. As of today, Xero's Enterprise Value is A$12,692 Mil.
Xero's Free Cash Flow for the trailing twelve months (TTM) ended in Mar. 2026 was A$432 Mil. Therefore, Xero's EV-to-FCF for today is 29.39.
The historical rank and industry rank for Xero's EV-to-FCF or its related term are showing as below:
ASX:XRO'
s EV-to-FCF Range Over the Past 10 Years
Min: -195.01 Med: 102.09 Max: 1375.24
Current: 28.98
During the past 13 years, the highest EV-to-FCF of Xero was 1375.24. The lowest was -195.01. And the median was 102.09.
ASX:XRO's EV-to-FCF is ranked worse than 74.26% of 1589
companies
in the Software industry
Industry Median: 14.3
vs ASX:XRO: 28.98
EV-to-FCF is a valuation multiple that allows analysts and investors to compare stocks, preferably in the same sector or industry. This important multiple is often used in conjunction with, or as an alternative to, the PE Ratio (TTM) to determine the fair market value of a company.
As of today (2026-07-03), Xero's stock price is A$72.25.
Xero's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Mar. 2026 was A$0.841. Therefore, Xero's PE Ratio (TTM) for today is 85.91.
Xero (ASX:XRO) EV-to-FCF Explanation
EV-to-FCF is a valuation multiple that allows analysts and investors to compare stocks, preferably in the same sector or industry. This important multiple is often used in conjunction with, or as an alternative to, the PE Ratio (TTM) to determine the fair market value of a company.
Xero's share price for today is A$72.25.
For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Xero's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Mar. 2026 was A$0.841.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Enterprise Value is used because it is a more complete measure in reflecting how much an investor pays when buying a company. Free Cash Flow is an important financial metric because it represents the actual amount of cash at a company's disposal. Companies with a low EV-to-FCF ratio, combined with a strong balance sheet are generally considered as undervalued.
Xero EV-to-FCF Related Terms
Xero EV-to-FCF Historical Data
* Premium members only.
The historical data trend for Xero's EV-to-FCF can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Software - Application subindustry, Xero's EV-to-FCF, along with its competitors' market caps and EV-to-FCF data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Xero EV-to-FCF vs Software Industry
For the Software industry and Technology sector, Xero's EV-to-FCF distribution charts can be found below:
* The bar in red indicates where Xero's EV-to-FCF falls into.
Xero's current Enterprise Value is A$12,692 Mil.
For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Xero's Free Cash Flow for the trailing twelve months (TTM) ended in Mar. 2026 was A$432 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Xero (ASX:XRO) has a EV-to-FCF of 29.39 as of Jul. 03, 2026. EV to FCF ratio is the company's enterprise value divided by free cash flow. View historical data on Xero and its competitors. This is 71% below median its historical median of 102.09. According to the industry distribution chart, Xero ranks #1180 out of 1589 companies in the Software industry, placing it in the top 74.3%.
Is Xero's EV-to-FCF too high?
Xero's current EV-to-FCF of 29.39 is 71% below median its 10-year median of 102.09. The Software industry median EV-to-FCF is 14.30. Xero's value of 29.39 is 105.5% above this industry median. Based on the distribution chart, Xero ranks #1180 out of 1589 companies in the Software industry, which is below the industry midpoint. Overall, Xero has a GF Score™ of 81/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Xero's EV-to-FCF compare to UBER and SHOP?
According to the Software industry distribution chart, Xero ranks #1180 out of 1589 companies for EV-to-FCF. This places Xero in the lower half of its industry. The industry median EV-to-FCF is 14.30. Xero's value of 29.39 is 105.5% above this benchmark. While the company's 10-year median is 102.09 vs. the industry median of 14.30, Xero has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good EV-to-FCF for a Software company?
The median EV-to-FCF among Software companies is 14.30, based on 1,589 companies in the industry. Companies in the top quartile (top 25%) have a EV-to-FCF significantly above this median, while those in the bottom quartile fall well below. However, EV-to-FCF should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Xero's current EV-to-FCF of 29.39 is 105.5% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high EV-to-FCF mean?
A high EV-to-FCF can signal that a stock is expensive relative to its fundamentals. EV to FCF ratio is the company's enterprise value divided by free cash flow. View historical data on Xero and its competitors. For the Software industry, the median EV-to-FCF is 14.30 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Xero's current EV-to-FCF is 29.39, which is 71% below median its own 10-year median of 102.09. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Xero stock overvalued right now?
Based on GuruFocus' analysis, Xero (ASX:XRO) is currently considered Possible Value Trap. The stock's GF Value™ is A$196.18, compared to a current price of A$72.25 — trading 63.2% below its estimated fair value. The current EV-to-FCF is 29.39, which is 71% below median its 10-year median of 102.09 and 105.5% above the Software industry median of 14.30. Xero's overall GF Score™ is 81/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is EV-to-FCF calculated?
EV-to-FCF is calculated from a company's financial statements. For Xero (ASX:XRO), the current EV-to-FCF is 29.39 as of Jul. 03, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Xero (ASX:XRO) Overvalued in 2026?
Based on GuruFocus' analysis, Xero stock appears to be undervalued.
The current stock price of A$72.25 is trading 63.2% below its estimated GF Value™ of A$196.18.
GuruFocus considers Xero to be Possible Value Trap.
Key valuation signals for ASX:XRO:
EV-to-FCF: 29.39 (71% below median its 10-year median of 102.09)
GF Value™: A$196.18 vs. price of A$72.25 (63.2% below fair value)
Industry Position: 105.5% above the Software median (#1180 of 1589)
No single metric tells the full story. See the ASX:XRO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Xero is a technology company originating from New Zealand, providing cloud-based accounting software, primarily for small and midsized enterprises, or SMEs, and accounting practices. As a first mover in the space for cloud-based accounting software, Xero has grown quickly to achieve dominant market share in New Zealand and Australia, displacing legacy providers. Xero has also expanded beyond its home region toward other English-speaking countries, primarily the UK and the US.
81GF Score
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