DXPE
DXP Enterprises, Inc.
$144.20
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 157.2% above fair value
You pay
$144.20
Bear
$18.30
Fair
$56.06
Bull
$94.23
Bear
$18.30
-87.3%
7% stage 1 growth, 11% discount
Fair
$56.06
-61.1%
11% stage 1 growth, 11% discount
Bull
$94.23
-34.7%
14% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
40%
Implied Market Multiple
58.6x
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 $154.00 from 7 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $56.06 per share.
Warnings
Wall Street's average price target is $154.00 (from 7 analysts). Our estimate is 79% 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