CSW
CSW Industrials, Inc.
$293.09
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 86.4% above fair value
You pay
$293.09
Bear
$93.33
Fair
$157.25
Bull
$221.36
Bear
$93.33
-68.2%
6% stage 1 growth, 11% discount
Fair
$157.25
-46.3%
11% stage 1 growth, 11% discount
Bull
$221.36
-24.5%
14% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
40%
Implied Market Multiple
46.9x
Market is pricing in (growth)
20.3%
vs 10.8% 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 $325.33 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $157.25 per share.
Warnings
Wall Street's average price target is $325.33 (from 5 analysts). Our estimate is 65% 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