MNRO
Monro Inc.
$16.96
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Undervalued
Trading 27.4% below fair value
You pay
$16.96
Bear
$20.45
Fair
$23.37
Bull
$26.29
Bear
$20.45
+20.6%
$1.36 × 14x P/E
Fair
$23.37
+37.8%
$1.36 × 16x P/E
Bull
$26.29
+55.0%
$1.36 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
12.4x
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 $28.00 from 24 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $23.37 per share.
Warnings
The company's reported profits differ from official accounting profits by 4860%. Check what costs are being left out of the adjusted number.
The company pays out 4073% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Dividend-based valuation: $16.43 (below our primary estimate by 25%). Large gaps may signal the dividend doesn't reflect full earning power.
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