OSIS
OSI Systems, Inc.
$214.39
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 173.3% above fair value
You pay
$214.39
Bear
$0.00
Fair
$78.45
Bull
$516.43
Bear
$0.00
-100.0%
5% stage 1 growth, 11% discount
Fair
$78.45
-63.4%
8% stage 1 growth, 11% discount
Bull
$516.43
+140.9%
10% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
37%
Implied Market Multiple
127.9x
Market is pricing in (growth)
33.8%
vs 8.0% 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 $310.00 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $78.45 per share.
Warnings
Wall Street's average price target is $310.00 (from 18 analysts). Our estimate is 100% 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