AVTR
Avantor, Inc.
$8.12
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 51.3% above fair value
You pay
$8.12
Bear
$4.59
Fair
$5.37
Bull
$6.47
Bear
$4.59
-43.5%
3% stage 1 growth, 11% discount
Fair
$5.37
-33.9%
4% stage 1 growth, 11% discount
Bull
$6.47
-20.4%
5% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (4% base case)
Terminal Value % of EV
33%
Implied Market Multiple
19.8x
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 $9.44 from 26 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $5.37 per share.
Warnings
Wall Street's average price target is $9.44 (from 26 analysts). Our estimate is 58% 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