CAG
Conagra Brands, Inc.
$15.43
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 42.8% below fair value
You pay
$15.43
Bear
$22.22
Fair
$26.98
Bull
$31.75
Bear
$22.22
+44.0%
$1.84 × 14x P/E
Fair
$26.98
+74.9%
$1.84 × 17x P/E
Bull
$31.75
+105.7%
$1.84 × 20x P/E
Key Value Driver
Normalized P/E multiple (17x base case)
Implied Market Multiple
8.4x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $14.10 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $26.98 per share.
Warnings
Wall Street's average price target is $14.10 (from 25 analysts). Our estimate is 122% 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