PTC
PTC Inc.
$124.74
Platform & Compounding FCF
80%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 3.3% below fair value
You pay
$124.74
Bear
$97.68
Fair
$128.94
Bull
$158.42
Bear
$97.68
-21.7%
5% stage 1 growth, 11% discount
Fair
$128.94
+3.4%
8% stage 1 growth, 11% discount
Bull
$158.42
+27.0%
11% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
38%
Implied Market Multiple
22.5x
Market is pricing in (growth)
10.5%
vs 8.5% base
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 $184.11 from 33 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $128.94 per share.
Warnings
Wall Street's average price target is $184.11 (from 33 analysts). Our estimate is 43% 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