MKSI
MKS Inc.
$320.62
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 142.3% above fair value
You pay
$320.62
Bear
$68.61
Fair
$132.31
Bull
$196.22
Bear
$68.61
-78.6%
7% stage 1 growth, 12% discount
Fair
$132.31
-58.7%
11% stage 1 growth, 12% discount
Bull
$196.22
-38.8%
14% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
35%
Implied Market Multiple
56.3x
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 $296.75 from 29 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $132.31 per share.
Warnings
Wall Street's average price target is $296.75 (from 29 analysts). Our estimate is 74% 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