MASI
Masimo Corporation
$179.95
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 129.9% above fair value
You pay
$179.95
Bear
$63.57
Fair
$78.27
Bull
$91.22
Bear
$63.57
-64.7%
4% stage 1 growth, 11% discount
Fair
$78.27
-56.5%
6% stage 1 growth, 11% discount
Bull
$91.22
-49.3%
8% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
35%
Implied Market Multiple
57.5x
Market is pricing in (growth)
23.1%
vs 5.9% 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 $180.00 from 23 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $78.27 per share.
Warnings
Wall Street's average price target is $180.00 (from 23 analysts). Our estimate is 75% below the consensus -- consider that gap carefully.
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