LYTS
LSI Industries Inc.
$23.26
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 10.2% below fair value
You pay
$23.26
Bear
$16.67
Fair
$25.90
Bull
$35.80
Bear
$16.67
-28.3%
8% stage 1 growth, 11% discount
Fair
$25.90
+11.4%
13% stage 1 growth, 11% discount
Bull
$35.80
+53.9%
17% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
42%
Implied Market Multiple
25.5x
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 $27.00 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $25.90 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