BHE
Benchmark Electronics, Inc.
$81.47
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 135.7% above fair value
You pay
$81.47
Bear
$29.66
Fair
$34.57
Bull
$38.82
Bear
$29.66
-63.6%
3% stage 1 growth, 11% discount
Fair
$34.57
-57.6%
5% stage 1 growth, 11% discount
Bull
$38.82
-52.3%
7% stage 1 growth, 11% discount
Adjust Assumptions
5.3%
11.0%
3.0%
Key Value Driver
FCF growth rate (5% base case)
Terminal Value % of EV
35%
Implied Market Multiple
36.1x
Market is pricing in (growth)
16.9%
vs 5.3% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (9 analysts)
$91.00
Divergence from AlphaVal
62%
Summary
Using a two-stage FCF DCF with 5% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $34.57 per share.
Warnings
Stock-based employee pay equals 69% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $91.00 (from 9 analysts). Our estimate is 62% 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