SEMR
Semrush Holdings, Inc.
$12.00
High-Growth Software
80%
Revenue × Terminal Margin DCF
Strong
·
Conviction
Undervalued
Trading 47.7% below fair value
You pay
$12.00
Bear
$11.69
Fair
$22.96
Bull
$36.39
Bear
$11.69
-2.6%
14% rev growth, 21% terminal margin
Fair
$22.96
+91.3%
23% rev growth, 28% terminal margin
Bull
$36.39
+203.3%
30% rev growth, 32% terminal margin
Adjust Assumptions
23.0%
28.0%
12.0%
Key Value Driver
Revenue growth (23%) × margin expansion to 28%
Terminal Value % of EV
61%
Implied Market Multiple
3.5x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (7 analysts)
$13.80
Divergence from AlphaVal
66%
Summary
Projecting 23% revenue growth with FCF margins expanding from 13% to 28% over 10 years, discounted at 12%, the base-case value is $22.96 per share.
Warnings
Gross margin of 81% means each dollar of revenue is highly profitable. As the company grows, overhead costs should shrink as a share of revenue, boosting overall profits.
Wall Street's average price target is $13.80 (from 7 analysts). Our estimate is 66% above the consensus -- consider that gap carefully.
Key Risks
- Current FCF misleads — the model values future margins, not today's cash
- SBC dilution is the hidden tax: 2-4% annual share growth compounds fast
- Revenue deceleration is inevitable — the question is when and how steep