DT
Dynatrace, Inc.
$45.16
Platform & Compounding FCF
85%
Two-stage FCF DCF
Moderate
·
Conviction
Fair Value
Trading 24.7% below fair value
You pay
$45.16
Bear
$38.26
Fair
$59.97
Bull
$84.77
Bear
$38.26
-15.3%
10% stage 1 growth, 11% discount
Fair
$59.97
+32.8%
16% stage 1 growth, 11% discount
Bull
$84.77
+87.7%
21% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (16% base case)
Terminal Value % of EV
44%
Implied Market Multiple
23.1x
Market is pricing in (growth)
10.9%
vs 16.0% 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 $48.53 from 34 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $59.97 per share.
Warnings
Wall Street's average price target is $48.53 (from 34 analysts). Our estimate is 34% above 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