CWCO
Consolidated Water Co. Ltd.
$30.58
Platform & Compounding FCF
65%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 50.0% below fair value
You pay
$30.58
Bear
$43.97
Fair
$61.18
Bull
$79.41
Bear
$43.97
+43.8%
8% stage 1 growth, 11% discount
Fair
$61.18
+100.1%
13% stage 1 growth, 11% discount
Bull
$79.41
+159.7%
17% stage 1 growth, 11% discount
Adjust Assumptions
13.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
11.6x
Market is pricing in (growth)
1.5%
vs 13.0% base
Summary
Using a two-stage FCF DCF with 13% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $61.18 per share.
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