ESLT
Elbit Systems Ltd.
$820.21
Platform & Compounding FCF
70%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 99.3% above fair value
You pay
$820.21
Bear
$293.34
Fair
$411.53
Bull
$531.30
Bear
$293.34
-64.2%
7% stage 1 growth, 11% discount
Fair
$411.53
-49.8%
11% stage 1 growth, 11% discount
Bull
$531.30
-35.2%
15% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
40%
Implied Market Multiple
64.5x
Market is pricing in (growth)
24.6%
vs 11.2% 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 $862.50 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $411.53 per share.
Warnings
Wall Street's average price target is $862.50 (from 6 analysts). Our estimate is 65% 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