SEPN
Septerna, Inc.
$28.36
High-Growth Software
80%
Revenue × Terminal Margin DCF
Strong
·
Conviction
Undervalued
Trading 45.1% below fair value
You pay
$28.36
Bear
$30.39
Fair
$51.69
Bull
$76.87
Bear
$30.39
+7.2%
14% rev growth, 100% terminal margin
Fair
$51.69
+82.3%
24% rev growth, 133% terminal margin
Bull
$76.87
+171.1%
31% rev growth, 153% terminal margin
Key Value Driver
Revenue growth (24%) × margin expansion to 133%
Terminal Value % of EV
49%
Implied Market Multiple
19.8x
Summary
Our base-case estimate uses a discounted cash flow model based on revenue growth and long-run free cash flow margins. We then blend that result with the average analyst price target of $41.75 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $51.69 per share.
Warnings
Gross margin of 100% 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 $41.75 (from 6 analysts). Our estimate is 30% 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