LEG
Leggett & Platt, Incorporated
$10.70
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 65.9% below fair value
You pay
$10.70
Bear
$27.47
Fair
$31.39
Bull
$35.31
Bear
$27.47
+156.7%
$2.27 × 14x P/E
Fair
$31.39
+193.4%
$2.27 × 16x P/E
Bull
$35.31
+230.0%
$2.27 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
4.7x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $11.67 from 14 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $31.39 per share.
Warnings
The company's reported profits differ from official accounting profits by 34%. Check what costs are being left out of the adjusted number.
Wall Street's average price target is $11.67 (from 14 analysts). Our estimate is 211% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples