ESAB
ESAB Corporation
$67.47
Platform & Compounding FCF
50%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 17.1% above fair value
You pay
$67.47
Bear
$41.62
Fair
$57.62
Bull
$72.47
Bear
$41.62
-38.3%
5% stage 1 growth, 11% discount
Fair
$57.62
-14.6%
8% stage 1 growth, 11% discount
Bull
$72.47
+7.4%
10% stage 1 growth, 11% discount
Adjust Assumptions
7.8%
11.0%
3.0%
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
37%
Implied Market Multiple
20.7x
Market is pricing in (growth)
9.4%
vs 7.8% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$121.75
Divergence from AlphaVal
53%
Summary
Using a two-stage FCF DCF with 8% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $57.62 per share.
Warnings
Wall Street's average price target is $121.75 (from 10 analysts). Our estimate is 53% 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