DJCO
Daily Journal Corporation
$607.82
Platform & Compounding FCF
80%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 0.9% below fair value
You pay
$607.82
Bear
$536.52
Fair
$613.54
Bull
$692.97
Bear
$536.52
-11.7%
7% stage 1 growth, 11% discount
Fair
$613.54
+0.9%
12% stage 1 growth, 11% discount
Bull
$692.97
+14.0%
15% stage 1 growth, 11% discount
Adjust Assumptions
11.9%
11.0%
3.0%
Key Value Driver
FCF growth rate (12% base case)
Terminal Value % of EV
40%
Implied Market Multiple
24.3x
Market is pricing in (growth)
11.6%
vs 11.9% base
Summary
Using a two-stage FCF DCF with 12% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $613.54 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