CRCT
Cricut, Inc.
$6.25
Platform & Compounding FCF
65%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 40.3% below fair value
You pay
$6.25
Bear
$10.47
Fair
$10.47
Bull
$11.09
Bear
$10.47
+67.5%
3% stage 1 growth, 11% discount
Fair
$10.47
+67.5%
3% stage 1 growth, 11% discount
Bull
$11.09
+77.4%
4% stage 1 growth, 11% discount
Adjust Assumptions
3.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (3% base case)
Terminal Value % of EV
33%
Implied Market Multiple
7.0x
Market is pricing in (growth)
-5.8%
vs 3.0% base
Summary
Using a two-stage FCF DCF with 3% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $10.47 per share.
Warnings
Stock-based employee pay equals 45% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
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