CVLT
Commvault Systems, Inc.
$145.31
Platform & Compounding FCF
80%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 49.4% above fair value
You pay
$145.31
Bear
$71.37
Fair
$97.24
Bull
$122.85
Bear
$71.37
-50.9%
6% stage 1 growth, 11% discount
Fair
$97.24
-33.1%
10% stage 1 growth, 11% discount
Bull
$122.85
-15.5%
13% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (10% base case)
Terminal Value % of EV
39%
Implied Market Multiple
41.7x
Market is pricing in (growth)
18.8%
vs 10.3% 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 $144.85 from 33 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $97.24 per share.
Warnings
Stock-based employee pay equals 175% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $144.85 (from 33 analysts). Our estimate is 47% 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