GLOB
Globant S.A.
$29.96
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 68.4% below fair value
You pay
$29.96
Bear
$65.98
Fair
$94.81
Bull
$124.27
Bear
$65.98
+120.2%
7% stage 1 growth, 11% discount
Fair
$94.81
+216.5%
12% stage 1 growth, 11% discount
Bull
$124.27
+314.8%
15% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (12% base case)
Terminal Value % of EV
40%
Implied Market Multiple
7.4x
Market is pricing in (growth)
-4.9%
vs 11.5% 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 $51.60 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $94.81 per share.
Warnings
Stock-based employee pay equals 74% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $51.60 (from 29 analysts). Our estimate is 112% 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