DFIN
Donnelley Financial Solutions, Inc.
$49.12
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Fair Value
Trading 24.5% below fair value
You pay
$49.12
Bear
$54.45
Fair
$65.03
Bull
$75.62
Bear
$54.45
+10.9%
$3.06 × 18x P/E
Fair
$65.03
+32.4%
$3.06 × 22x P/E
Bull
$75.62
+54.0%
$3.06 × 25x P/E
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
16.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $62.00 from 10 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $65.03 per share.
Warnings
The company's reported profits differ from official accounting profits by 166%. Check what costs are being left out of the adjusted number.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples