PLPC
Preformed Line Products Company
$421.67
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 253.3% above fair value
You pay
$421.67
Bear
$97.19
Fair
$119.37
Bull
$139.75
Bear
$97.19
-77.0%
4% stage 1 growth, 11% discount
Fair
$119.37
-71.7%
7% stage 1 growth, 11% discount
Bull
$139.75
-66.9%
10% stage 1 growth, 11% discount
Adjust Assumptions
7.5%
11.0%
3.0%
Key Value Driver
FCF growth rate (7% base case)
Terminal Value % of EV
37%
Implied Market Multiple
66.1x
Market is pricing in (growth)
24.9%
vs 7.5% base
Summary
Using a two-stage FCF DCF with 7% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $119.37 per share.
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