G
Genpact Limited
$30.89
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 54.0% below fair value
You pay
$30.89
Bear
$49.80
Fair
$67.15
Bull
$84.02
Bear
$49.80
+61.2%
6% stage 1 growth, 11% discount
Fair
$67.15
+117.4%
10% stage 1 growth, 11% discount
Bull
$84.02
+172.0%
13% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (10% base case)
Terminal Value % of EV
39%
Implied Market Multiple
8.7x
Market is pricing in (growth)
-2.5%
vs 9.6% 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 $39.00 from 40 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $67.15 per share.
Warnings
Wall Street's average price target is $39.00 (from 40 analysts). Our estimate is 103% 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