EVTC
EVERTEC, Inc.
$31.40
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 50.2% below fair value
You pay
$31.40
Bear
$38.78
Fair
$63.04
Bull
$88.62
Bear
$38.78
+23.5%
8% stage 1 growth, 11% discount
Fair
$63.04
+100.8%
13% stage 1 growth, 11% discount
Bull
$88.62
+182.2%
17% stage 1 growth, 11% discount
Adjust Assumptions
12.8%
11.0%
3.0%
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
15.6x
Market is pricing in (growth)
5.6%
vs 12.8% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (18 analysts)
$34.00
Divergence from AlphaVal
85%
Summary
Using a two-stage FCF DCF with 13% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $63.04 per share.
Warnings
Wall Street's average price target is $34.00 (from 18 analysts). Our estimate is 85% above 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