ALGT
Allegiant Travel Company
$100.90
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 80.8% below fair value
You pay
$100.90
Bear
$259.32
Fair
$524.16
Bull
$865.11
Bear
$259.32
+157.0%
13% stage 1 growth, 12% discount
Fair
$524.16
+419.5%
21% stage 1 growth, 12% discount
Bull
$865.11
+757.4%
28% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (21% base case)
Terminal Value % of EV
43%
Implied Market Multiple
9.2x
Market is pricing in (growth)
-0.2%
vs 21.4% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $130.63 from 31 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $524.16 per share.
Warnings
This company spends 12% of revenue on big investments like data centers and infrastructure, mostly for growth. We adjusted the cash flow figure to only subtract the upkeep costs, giving a clearer picture of true profitability.
Wall Street's average price target is $130.63 (from 31 analysts). Our estimate is 430% 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