AMRX
Amneal Pharmaceuticals, Inc.
$12.42
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 3.5% above fair value
You pay
$12.42
Bear
$10.29
Fair
$12.00
Bull
$13.73
Bear
$10.29
-17.1%
$0.71 × 12x P/E
Fair
$12.00
-3.3%
$0.71 × 14x P/E
Bull
$13.73
+10.5%
$0.71 × 17x P/E
Key Value Driver
Normalized P/E multiple (14x base case)
Implied Market Multiple
17.6x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $17.33 from 16 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $12.00 per share.
Warnings
The company's reported profits differ from official accounting profits by 222%. Check what costs are being left out of the adjusted number.
Wall Street's average price target is $17.33 (from 16 analysts). Our estimate is 41% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples