ASC
Ardmore Shipping Corporation
$18.93
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 53.4% below fair value
You pay
$18.93
Bear
$32.52
Fair
$40.65
Bull
$48.78
Bear
$32.52
+71.8%
$2.71 × 12x P/E
Fair
$40.65
+114.7%
$2.71 × 15x P/E
Bull
$48.78
+157.7%
$2.71 × 18x P/E
Adjust Assumptions
15.0x
2.71$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
7.0x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (17 analysts)
$19.00
Divergence from AlphaVal
114%
Summary
Applying a 15x P/E to adjusted EPS of $2.71, the base-case value is $40.65 per share.
Warnings
The company's reported profits differ from official accounting profits by 208%. Check what costs are being left out of the adjusted number.
The company pays out 156% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $19.00 (from 17 analysts). Our estimate is 114% above 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