MGPI
MGP Ingredients, Inc.
$15.12
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 57.2% below fair value
You pay
$15.12
Bear
$35.35
Fair
$35.35
Bull
$38.52
Bear
$35.35
+133.8%
3% stage 1 growth, 11% discount
Fair
$35.35
+133.8%
3% stage 1 growth, 11% discount
Bull
$38.52
+154.8%
4% stage 1 growth, 11% discount
Adjust Assumptions
3.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (3% base case)
Terminal Value % of EV
33%
Implied Market Multiple
7.3x
Market is pricing in (growth)
-5.0%
vs 3.0% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (14 analysts)
$25.50
Divergence from AlphaVal
39%
Summary
Using a two-stage FCF DCF with 3% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $35.35 per share.
Warnings
Wall Street's average price target is $25.50 (from 14 analysts). Our estimate is 39% above the consensus -- consider that gap carefully.
This stock is 44% below its 52-week high, with weak or declining earnings. That combination often signals real trouble, even though the valuation below is based on other fundamentals.
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