RMBS
Rambus Inc.
$92.80
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 42.0% below fair value
You pay
$92.80
Bear
$80.09
Fair
$159.90
Bull
$271.33
Bear
$80.09
-13.7%
15% stage 1 growth, 12% discount
Fair
$159.90
+72.3%
25% stage 1 growth, 12% discount
Bull
$271.33
+192.4%
32% stage 1 growth, 12% discount
Adjust Assumptions
25.0%
12.0%
3.0%
Key Value Driver
FCF growth rate (25% base case)
Terminal Value % of EV
45%
Implied Market Multiple
31.8x
Market is pricing in (growth)
17.2%
vs 25.0% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (16 analysts)
$161.75
Divergence from AlphaVal
1%
Summary
Using a two-stage FCF DCF with 25% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $159.90 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