SCHL
Scholastic Corporation
$40.47
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Overvalued
Trading 5.4% above fair value
You pay
$40.47
Bear
$30.71
Fair
$38.38
Bull
$46.06
Bear
$30.71
-24.1%
$2.56 × 12x P/E
Fair
$38.38
-5.2%
$2.56 × 15x P/E
Bull
$46.06
+13.8%
$2.56 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
15.8x
Summary
Applying a 15x P/E to adjusted EPS of $2.56, the base-case value is $38.38 per share. DDM cross-check: $36.04.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples