RIGL
Rigel Pharmaceuticals, Inc.
$40.54
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 59.2% below fair value
You pay
$40.54
Bear
$63.75
Fair
$99.35
Bull
$139.65
Bear
$63.75
+57.3%
9% stage 1 growth, 11% discount
Fair
$99.35
+145.1%
16% stage 1 growth, 11% discount
Bull
$139.65
+244.5%
20% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (16% base case)
Terminal Value % of EV
43%
Implied Market Multiple
9.8x
Market is pricing in (growth)
-0.8%
vs 15.7% 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 $27.33 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $99.35 per share.
Warnings
Wall Street's average price target is $27.33 (from 15 analysts). Our estimate is 351% 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