RMNI
Rimini Street, Inc.
$4.64
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 62.8% below fair value
You pay
$4.64
Bear
$8.62
Fair
$12.47
Bull
$16.51
Bear
$8.62
+85.9%
8% stage 1 growth, 11% discount
Fair
$12.47
+168.7%
13% stage 1 growth, 11% discount
Bull
$16.51
+255.8%
16% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
8.5x
Market is pricing in (growth)
-2.9%
vs 12.7% 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 $7.17 from 5 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $12.47 per share.
Warnings
Wall Street's average price target is $7.17 (from 5 analysts). Our estimate is 92% 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