COHR
Coherent, Inc.
$277.60
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 119.3% above fair value
You pay
$277.60
Bear
$34.04
Fair
$126.60
Bull
$249.89
Bear
$34.04
-87.7%
14% stage 1 growth, 12% discount
Fair
$126.60
-54.4%
23% stage 1 growth, 12% discount
Bull
$249.89
-10.0%
30% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (23% base case)
Terminal Value % of EV
44%
Implied Market Multiple
251.9x
Market is pricing in (growth)
45.9%
vs 22.9% 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 $333.14 from 30 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $126.60 per share.
Warnings
Stock-based employee pay equals 325% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $333.14 (from 30 analysts). Our estimate is 89% 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