ATI
ATI Inc.
$162.29
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 133.0% above fair value
You pay
$162.29
Bear
$48.07
Fair
$69.64
Bull
$90.24
Bear
$48.07
-70.4%
5% stage 1 growth, 11% discount
Fair
$69.64
-57.1%
9% stage 1 growth, 11% discount
Bull
$90.24
-44.4%
12% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (9% base case)
Terminal Value % of EV
38%
Implied Market Multiple
75.9x
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 $175.00 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $69.64 per share.
Warnings
Wall Street's average price target is $175.00 (from 29 analysts). Our estimate is 80% 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