QSR
Restaurant Brands International Inc.
$76.83
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 12.4% above fair value
You pay
$76.83
Bear
$57.24
Fair
$68.37
Bull
$79.50
Bear
$57.24
-25.5%
$3.18 × 18x P/E
Fair
$68.37
-11.0%
$3.18 × 22x P/E
Bull
$79.50
+3.5%
$3.18 × 25x P/E
Adjust Assumptions
21.5x
3.18$
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
24.2x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (44 analysts)
$84.33
Divergence from AlphaVal
19%
Summary
Applying a 22x P/E to adjusted EPS of $3.18, the base-case value is $68.37 per share. DDM cross-check: $60.99.
Warnings
The company's reported profits differ from official accounting profits by 35%. Check what costs are being left out of the adjusted number.
The company pays out 109% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
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