AMRZ
Amrize Ltd
$41.95
Cyclical & Capital-Intensive
70%
Normalized Earnings × Cycle Multiple
Moderate
·
Conviction
Overvalued
Trading 16.5% above fair value
You pay
$41.95
Bear
$28.00
Fair
$36.00
Bull
$44.00
Bear
$28.00
-33.3%
$2.00 × 14x
Fair
$36.00
-14.2%
$2.00 × 18x
Bull
$44.00
+4.9%
$2.00 × 22x
Adjust Assumptions
18.0x
2.0$
Key Value Driver
Through-cycle normalized EPS ($2.00)
Implied Market Multiple
21.0x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (9 analysts)
$55.44
Divergence from AlphaVal
35%
Summary
Using 5-year normalized EPS of $2.00 at a 18x cycle multiple, the base-case value is $36.00 per share. P/TBV cross-check: 9.3x.
Warnings
This company has a built-in lending arm whose debt is mixed in with the main business. We capped the debt adjustment to avoid overstating what the core business owes.
Price-to-book value of 9.3x is above the normal range for this type of business (0.7x-2.0x). The stock may already price in a strong cycle.
Wall Street's average price target is $55.44 (from 9 analysts). Our estimate is 35% below the consensus -- consider that gap carefully.
Key Risks
- Standard 10-year DCF produces unreliable terminal values for cyclicals
- 'Cheap' P/E at cycle peak is the most common value trap — normalize first
- Captive finance subsidiaries have different risk profiles from manufacturing