ADBE
Adobe Inc.
$245.20
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 60.9% below fair value
You pay
$245.20
Bear
$397.62
Fair
$626.63
Bull
$883.94
Bear
$397.62
+62.2%
9% stage 1 growth, 12% discount
Fair
$626.63
+155.6%
16% stage 1 growth, 12% discount
Bull
$883.94
+260.5%
20% stage 1 growth, 12% discount
Adjust Assumptions
15.6%
12.0%
3.0%
Key Value Driver
FCF growth rate (16% base case)
Terminal Value % of EV
39%
Implied Market Multiple
11.1x
Market is pricing in (growth)
2.5%
vs 15.6% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (64 analysts)
$260.61
Divergence from AlphaVal
140%
Summary
Using a two-stage FCF DCF with 16% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $626.63 per share.
Warnings
Wall Street's average price target is $260.61 (from 64 analysts). Our estimate is 140% 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