NCMI
National CineMedia, Inc.
$2.99
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 67.9% below fair value
You pay
$2.99
Bear
$7.36
Fair
$9.31
Bull
$11.16
Bear
$7.36
+146.2%
5% stage 1 growth, 12% discount
Fair
$9.31
+211.5%
9% stage 1 growth, 12% discount
Bull
$11.16
+273.1%
11% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (9% base case)
Terminal Value % of EV
34%
Implied Market Multiple
4.5x
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 $9.31 per share.
Warnings
Wall Street's average price target is $7.50 (from 17 analysts). Our estimate is 32% above 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