CWST
Casella Waste Systems, Inc.
$86.54
Platform & Compounding FCF
85%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 31.3% above fair value
You pay
$86.54
Bear
$38.52
Fair
$65.90
Bull
$95.11
Bear
$38.52
-55.5%
8% stage 1 growth, 11% discount
Fair
$65.90
-23.8%
13% stage 1 growth, 11% discount
Bull
$95.11
+9.9%
17% stage 1 growth, 11% discount
Adjust Assumptions
13.2%
11.0%
3.0%
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
42%
Implied Market Multiple
34.3x
Market is pricing in (growth)
16.2%
vs 13.2% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (19 analysts)
$110.67
Divergence from AlphaVal
40%
Summary
Using a two-stage FCF DCF with 13% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $65.90 per share.
Warnings
Wall Street's average price target is $110.67 (from 19 analysts). Our estimate is 40% 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