CRL
Charles River Laboratories International, Inc.
$160.30
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 63.3% above fair value
You pay
$160.30
Bear
$98.17
Fair
$98.17
Bull
$111.93
Bear
$98.17
-38.8%
3% stage 1 growth, 12% discount
Fair
$98.17
-38.8%
3% stage 1 growth, 12% discount
Bull
$111.93
-30.2%
4% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (3% base case)
Terminal Value % of EV
28%
Implied Market Multiple
22.7x
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 $207.50 from 36 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $98.17 per share.
Warnings
Wall Street's average price target is $207.50 (from 36 analysts). Our estimate is 75% 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