ETD
Ethan Allen Interiors Inc.
$23.47
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 41.2% below fair value
You pay
$23.47
Bear
$34.94
Fair
$39.94
Bull
$44.93
Bear
$34.94
+48.9%
$2.50 × 14x P/E
Fair
$39.94
+70.2%
$2.50 × 16x P/E
Bull
$44.93
+91.4%
$2.50 × 18x P/E
Adjust Assumptions
16.0x
2.5$
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
9.4x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$22.00
Divergence from AlphaVal
82%
Summary
Applying a 16x P/E to adjusted EPS of $2.50, the base-case value is $39.94 per share.
Warnings
The company's reported profits differ from official accounting profits by 60%. Check what costs are being left out of the adjusted number.
The company pays out 283% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $22.00 (from 10 analysts). Our estimate is 82% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples