RRR
Red Rock Resorts, Inc.
$50.37
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 60.1% below fair value
You pay
$50.37
Bear
$100.43
Fair
$126.26
Bull
$150.32
Bear
$100.43
+99.4%
5% stage 1 growth, 12% discount
Fair
$126.26
+150.7%
8% stage 1 growth, 12% discount
Bull
$150.32
+198.4%
11% stage 1 growth, 12% discount
Adjust Assumptions
8.1%
12.0%
3.0%
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
33%
Implied Market Multiple
6.5x
Market is pricing in (growth)
-5.5%
vs 8.1% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (30 analysts)
$71.40
Divergence from AlphaVal
77%
Summary
Using a two-stage FCF DCF with 8% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $126.26 per share.
Warnings
Wall Street's average price target is $71.40 (from 30 analysts). Our estimate is 77% 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