ESE
ESCO Technologies Inc.
$249.12
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 78.5% above fair value
You pay
$249.12
Bear
$107.70
Fair
$139.59
Bull
$169.65
Bear
$107.70
-56.8%
5% stage 1 growth, 11% discount
Fair
$139.59
-44.0%
8% stage 1 growth, 11% discount
Bull
$169.65
-31.9%
11% stage 1 growth, 11% discount
Adjust Assumptions
8.4%
11.0%
3.0%
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
38%
Implied Market Multiple
33.7x
Market is pricing in (growth)
16.0%
vs 8.4% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (16 analysts)
$413.00
Divergence from AlphaVal
66%
Summary
Using a two-stage FCF DCF with 8% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $139.59 per share.
Warnings
Wall Street's average price target is $413.00 (from 16 analysts). Our estimate is 66% 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