KAI
Kadant Inc.
$312.36
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 11.7% above fair value
You pay
$312.36
Bear
$198.08
Fair
$279.76
Bull
$361.25
Bear
$198.08
-36.6%
6% stage 1 growth, 11% discount
Fair
$279.76
-10.4%
11% stage 1 growth, 11% discount
Bull
$361.25
+15.7%
14% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
39%
Implied Market Multiple
25.5x
Market is pricing in (growth)
12.3%
vs 10.6% 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 $303.00 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $279.76 per share.
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