CRCT
Cricut, Inc.
$3.98
Platform & Compounding FCF
65%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 77.8% below fair value
You pay
$3.98
Bear
$13.25
Fair
$17.93
Bull
$22.65
Bear
$13.25
+232.8%
7% stage 1 growth, 11% discount
Fair
$17.93
+350.4%
11% stage 1 growth, 11% discount
Bull
$22.65
+469.0%
14% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
40%
Implied Market Multiple
3.8x
Summary
Using a two-stage FCF DCF with 11% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $17.93 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