PAGS
PagSeguro Digital Ltd.
$9.14
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 200.2% above fair value
Bear
$0.00
-100.0%
3% stage 1 growth, 12% discount
Fair
$3.04
-66.7%
3% stage 1 growth, 12% discount
Bull
$0.00
-100.0%
4% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (3% base case)
Terminal Value % of EV
28%
Implied Market Multiple
32.7x
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 $12.18 from 24 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $3.04 per share.
Warnings
Wall Street's average price target is $12.18 (from 24 analysts). Our estimate is 100% below the consensus -- consider that gap carefully.
Financial statements were converted from BRL into USD using USDBRL at 0.1993 USD per BRL.
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