ARHS
Arhaus, Inc.
$6.32
Platform & Compounding FCF
85%
Two-stage FCF DCF
Moderate
·
Conviction
Fair Value
Trading 17.7% below fair value
You pay
$6.32
Bear
$4.57
Fair
$7.68
Bull
$10.90
Bear
$4.57
-27.6%
8% stage 1 growth, 12% discount
Fair
$7.68
+21.5%
13% stage 1 growth, 12% discount
Bull
$10.90
+72.5%
16% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
37%
Implied Market Multiple
20.7x
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 $9.79 from 14 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $7.68 per share.
Warnings
Wall Street's average price target is $9.79 (from 14 analysts). Our estimate is 27% below 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