PCRX
Pacira BioSciences, Inc.
$23.35
Platform & Compounding FCF
65%
Two-stage FCF DCF
Moderate
·
Conviction
Undervalued
Trading 37.0% below fair value
You pay
$23.35
Bear
$27.73
Fair
$37.05
Bull
$45.84
Bear
$27.73
+18.8%
5% stage 1 growth, 11% discount
Fair
$37.05
+58.7%
8% stage 1 growth, 11% discount
Bull
$45.84
+96.3%
11% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
38%
Implied Market Multiple
12.1x
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 $29.50 from 36 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $37.05 per share.
Warnings
Stock-based employee pay equals 817% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $29.50 (from 36 analysts). Our estimate is 37% 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