FRPT
Freshpet, Inc.
$59.50
Platform & Compounding FCF
85%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 2.6% above fair value
You pay
$59.50
Bear
$38.13
Fair
$58.02
Bull
$78.84
Bear
$38.13
-35.9%
8% stage 1 growth, 12% discount
Fair
$58.02
-2.5%
13% stage 1 growth, 12% discount
Bull
$78.84
+32.5%
17% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
37%
Implied Market Multiple
26.2x
Market is pricing in (growth)
14.5%
vs 12.7% 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 $77.33 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $58.02 per share.
Warnings
This company spends 13% of revenue on big investments like data centers and infrastructure, mostly for growth. We adjusted the cash flow figure to only subtract the upkeep costs, giving a clearer picture of true profitability.
Wall Street's average price target is $77.33 (from 29 analysts). Our estimate is 33% 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