BOX
Box, Inc.
$27.89
Platform & Compounding FCF
80%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 19.6% above fair value
You pay
$27.89
Bear
$15.89
Fair
$23.32
Bull
$30.73
Bear
$15.89
-43.0%
7% stage 1 growth, 12% discount
Fair
$23.32
-16.4%
11% stage 1 growth, 12% discount
Bull
$30.73
+10.2%
14% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
35%
Implied Market Multiple
25.2x
Market is pricing in (growth)
14.0%
vs 10.9% base
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 $29.00 from 28 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $23.32 per share.
Warnings
Stock-based employee pay equals 231% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $29.00 (from 28 analysts). Our estimate is 26% 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