NCMI
National CineMedia, Inc.
$3.82
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 54.3% below fair value
You pay
$3.82
Bear
$6.61
Fair
$8.36
Bull
$9.99
Bear
$6.61
+73.2%
5% stage 1 growth, 12% discount
Fair
$8.36
+118.7%
9% stage 1 growth, 12% discount
Bull
$9.99
+161.5%
11% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (9% base case)
Terminal Value % of EV
34%
Implied Market Multiple
7.0x
Market is pricing in (growth)
-4.4%
vs 8.8% 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 $7.50 from 17 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $8.36 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