INSP
Inspire Medical Systems, Inc.
$61.44
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 530.2% above fair value
You pay
$61.44
Bear
$9.71
Fair
$9.75
Bull
$9.79
Bear
$9.71
-84.2%
5% stage 1 growth, 11% discount
Fair
$9.75
-84.1%
8% stage 1 growth, 11% discount
Bull
$9.79
-84.1%
11% stage 1 growth, 11% discount
Adjust Assumptions
8.2%
11.0%
3.0%
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
37%
Implied Market Multiple
4946.8x
Market is pricing in (growth)
89.9%
vs 8.2% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (27 analysts)
$60.30
Divergence from AlphaVal
84%
Summary
Using a two-stage FCF DCF with 8% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $9.75 per share.
Warnings
Stock-based employee pay equals 90% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $60.30 (from 27 analysts). Our estimate is 84% 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