SKYW
SkyWest, Inc.
$94.25
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 48.4% below fair value
You pay
$94.25
Bear
$118.49
Fair
$182.76
Bull
$248.12
Bear
$118.49
+25.7%
7% stage 1 growth, 12% discount
Fair
$182.76
+93.9%
12% stage 1 growth, 12% discount
Bull
$248.12
+163.3%
15% stage 1 growth, 12% discount
Adjust Assumptions
11.6%
12.0%
3.0%
Key Value Driver
FCF growth rate (12% base case)
Terminal Value % of EV
36%
Implied Market Multiple
12.9x
Market is pricing in (growth)
4.7%
vs 11.6% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (17 analysts)
$112.00
Divergence from AlphaVal
63%
Summary
Using a two-stage FCF DCF with 12% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $182.76 per share.
Warnings
Wall Street's average price target is $112.00 (from 17 analysts). Our estimate is 63% 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