IRDM
Iridium Communications Inc.
$46.72
Platform & Compounding FCF
75%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 17.3% above fair value
You pay
$46.72
Bear
$29.45
Fair
$39.81
Bull
$49.22
Bear
$29.45
-37.0%
4% stage 1 growth, 11% discount
Fair
$39.81
-14.8%
7% stage 1 growth, 11% discount
Bull
$49.22
+5.4%
9% stage 1 growth, 11% discount
Adjust Assumptions
7.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (7% base case)
Terminal Value % of EV
36%
Implied Market Multiple
19.4x
Market is pricing in (growth)
8.6%
vs 7.0% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (14 analysts)
$49.75
Divergence from AlphaVal
20%
Summary
Using a two-stage FCF DCF with 7% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $39.81 per share.
Warnings
Stock-based employee pay equals 45% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
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