PBPB
Potbelly Corporation
$17.12
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Undervalued
Trading 36.6% below fair value
You pay
$17.12
Bear
$22.59
Fair
$26.98
Bull
$31.37
Bear
$22.59
+31.9%
$1.37 × 18x P/E
Fair
$26.98
+57.6%
$1.37 × 22x P/E
Bull
$31.37
+83.3%
$1.37 × 25x P/E
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
12.5x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $17.12 from 10 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $26.98 per share.
Warnings
Wall Street's average price target is $17.12 (from 10 analysts). Our estimate is 72% above the consensus -- consider that gap carefully.
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