CRS
Carpenter Technology Corporation
$578.61
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 216.3% above fair value
You pay
$578.61
Bear
$151.80
Fair
$182.96
Bull
$210.28
Bear
$151.80
-73.8%
3% stage 1 growth, 11% discount
Fair
$182.96
-68.4%
6% stage 1 growth, 11% discount
Bull
$210.28
-63.7%
7% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
35%
Implied Market Multiple
108.4x
Market is pricing in (growth)
31.6%
vs 5.7% 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 $502.80 from 21 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $182.96 per share.
Warnings
Wall Street's average price target is $502.80 (from 21 analysts). Our estimate is 85% 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