CBT
Cabot Corporation
$83.41
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 0.5% above fair value
You pay
$83.41
Bear
$74.19
Fair
$82.99
Bull
$92.91
Bear
$74.19
-11.0%
3% stage 1 growth, 11% discount
Fair
$82.99
-0.5%
4% stage 1 growth, 11% discount
Bull
$92.91
+11.4%
6% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (4% base case)
Terminal Value % of EV
34%
Implied Market Multiple
14.1x
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 $82.00 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $82.99 per share.
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