FOUR
Shift4 Payments, Inc.
$51.38
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 62.3% below fair value
You pay
$51.38
Bear
$68.05
Fair
$136.11
Bull
$213.62
Bear
$68.05
+32.5%
10% stage 1 growth, 12% discount
Fair
$136.11
+164.9%
16% stage 1 growth, 12% discount
Bull
$213.62
+315.8%
21% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (16% base case)
Terminal Value % of EV
39%
Implied Market Multiple
14.4x
Market is pricing in (growth)
6.3%
vs 16.2% 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 $63.77 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $136.11 per share.
Warnings
Wall Street's average price target is $63.77 (from 29 analysts). Our estimate is 151% 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