LDOS
Leidos Holdings, Inc.
$106.48
Platform & Compounding FCF
50%
Two-stage FCF DCF
Moderate
·
Conviction
Undervalued
Trading 38.1% below fair value
You pay
$106.48
Bear
$133.67
Fair
$172.07
Bull
$206.85
Bear
$133.67
+25.5%
4% stage 1 growth, 11% discount
Fair
$172.07
+61.6%
7% stage 1 growth, 11% discount
Bull
$206.85
+94.3%
9% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (7% base case)
Terminal Value % of EV
36%
Implied Market Multiple
11.7x
Market is pricing in (growth)
1.6%
vs 6.9% 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 $165.88 from 27 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $172.07 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