GE
GE Aerospace
$311.62
Platform & Compounding FCF
70%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 97.7% above fair value
You pay
$311.62
Bear
$109.81
Fair
$157.65
Bull
$206.61
Bear
$109.81
-64.8%
7% stage 1 growth, 12% discount
Fair
$157.65
-49.4%
12% stage 1 growth, 12% discount
Bull
$206.61
-33.7%
15% stage 1 growth, 12% discount
Adjust Assumptions
11.8%
12.0%
3.0%
Key Value Driver
FCF growth rate (12% base case)
Terminal Value % of EV
36%
Implied Market Multiple
41.5x
Market is pricing in (growth)
20.8%
vs 11.8% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (35 analysts)
$409.60
Divergence from AlphaVal
62%
Summary
Using a two-stage FCF DCF with 12% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $157.65 per share.
Warnings
Wall Street's average price target is $409.60 (from 35 analysts). Our estimate is 62% 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