RRX
Regal Rexnord Corporation
$150.48
Platform & Compounding FCF
85%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 62.5% below fair value
You pay
$150.48
Bear
$248.66
Fair
$401.45
Bull
$564.07
Bear
$248.66
+65.2%
8% stage 1 growth, 11% discount
Fair
$401.45
+166.8%
13% stage 1 growth, 11% discount
Bull
$564.07
+274.8%
17% stage 1 growth, 11% discount
Adjust Assumptions
13.2%
11.0%
3.0%
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
12.7x
Market is pricing in (growth)
2.8%
vs 13.2% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (22 analysts)
$242.00
Divergence from AlphaVal
66%
Summary
Using a two-stage FCF DCF with 13% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $401.45 per share.
Warnings
Wall Street's average price target is $242.00 (from 22 analysts). Our estimate is 66% 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