SAIC
Science Applications International Corporation
$136.74
Platform & Compounding FCF
50%
Two-stage FCF DCF
Moderate
·
Conviction
Fair Value
Trading 23.7% below fair value
You pay
$136.74
Bear
$144.75
Fair
$179.33
Bull
$209.34
Bear
$144.75
+5.9%
3% stage 1 growth, 11% discount
Fair
$179.33
+31.1%
5% stage 1 growth, 11% discount
Bull
$209.34
+53.1%
7% stage 1 growth, 11% discount
Adjust Assumptions
5.3%
11.0%
3.0%
Key Value Driver
FCF growth rate (5% base case)
Terminal Value % of EV
35%
Implied Market Multiple
12.6x
Market is pricing in (growth)
2.7%
vs 5.3% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (18 analysts)
$118.75
Divergence from AlphaVal
51%
Summary
Using a two-stage FCF DCF with 5% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $179.33 per share.
Warnings
Wall Street's average price target is $118.75 (from 18 analysts). Our estimate is 51% 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