NRC
NRC Health
$20.87
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 33.1% above fair value
You pay
$20.87
Bear
$12.54
Fair
$15.68
Bull
$18.81
Bear
$12.54
-39.9%
$1.25 × 10x P/E
Fair
$15.68
-24.9%
$1.25 × 12x P/E
Bull
$18.81
-9.9%
$1.25 × 15x P/E
Adjust Assumptions
12.5x
1.25$
Key Value Driver
Normalized P/E multiple (12x base case)
Implied Market Multiple
16.6x
Summary
Applying a 12x P/E to adjusted EPS of $1.25, the base-case value is $15.68 per share.
Warnings
The company's reported profits differ from official accounting profits by 141%. Check what costs are being left out of the adjusted number.
The company pays out 123% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
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