CDNA
CareDx, Inc
$21.63
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 91.3% above fair value
You pay
$21.63
Bear
$8.86
Fair
$11.30
Bull
$14.00
Bear
$8.86
-59.1%
9% stage 1 growth, 12% discount
Fair
$11.30
-47.7%
15% stage 1 growth, 12% discount
Bull
$14.00
-35.3%
19% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (15% base case)
Terminal Value % of EV
38%
Implied Market Multiple
96.3x
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 $24.00 from 13 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $11.30 per share.
Warnings
Wall Street's average price target is $24.00 (from 13 analysts). Our estimate is 66% 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