PENG
Penguin Solutions, Inc.
$53.21
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 200.1% above fair value
You pay
$53.21
Bear
$13.00
Fair
$17.73
Bull
$22.11
Bear
$13.00
-75.6%
5% stage 1 growth, 12% discount
Fair
$17.73
-66.7%
8% stage 1 growth, 12% discount
Bull
$22.11
-58.5%
10% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
33%
Implied Market Multiple
44.5x
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 $25.00 from 8 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $17.73 per share.
Warnings
Stock-based employee pay equals 191% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $25.00 (from 8 analysts). Our estimate is 36% 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