CRS
Carpenter Technology Corporation
$434.12
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 149.9% above fair value
You pay
$434.12
Bear
$144.12
Fair
$173.71
Bull
$199.64
Bear
$144.12
-66.8%
3% stage 1 growth, 11% discount
Fair
$173.71
-60.0%
6% stage 1 growth, 11% discount
Bull
$199.64
-54.0%
7% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
35%
Implied Market Multiple
81.8x
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 $465.80 from 21 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $173.71 per share.
Warnings
Wall Street's average price target is $465.80 (from 21 analysts). Our estimate is 84% 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