ACIW
ACI Worldwide, Inc.
$50.87
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 55.0% below fair value
You pay
$50.87
Bear
$62.17
Fair
$113.16
Bull
$174.90
Bear
$62.17
+22.2%
11% stage 1 growth, 11% discount
Fair
$113.16
+122.5%
18% stage 1 growth, 11% discount
Bull
$174.90
+243.8%
24% stage 1 growth, 11% discount
Adjust Assumptions
18.4%
11.0%
3.0%
Key Value Driver
FCF growth rate (18% base case)
Terminal Value % of EV
45%
Implied Market Multiple
19.5x
Market is pricing in (growth)
8.7%
vs 18.4% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (17 analysts)
$66.00
Divergence from AlphaVal
71%
Summary
Using a two-stage FCF DCF with 18% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $113.16 per share.
Warnings
Stock-based employee pay equals 31% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $66.00 (from 17 analysts). Our estimate is 71% above the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions