SMPL
The Simply Good Foods Company
$11.86
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 70.0% below fair value
You pay
$11.86
Bear
$32.60
Fair
$39.58
Bull
$46.57
Bear
$32.60
+174.8%
$2.08 × 18x P/E
Fair
$39.58
+233.7%
$2.08 × 22x P/E
Bull
$46.57
+292.6%
$2.08 × 26x P/E
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
5.7x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $18.33 from 24 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $39.58 per share.
Warnings
The company's reported profits differ from official accounting profits by 104%. Check what costs are being left out of the adjusted number.
Wall Street's average price target is $18.33 (from 24 analysts). Our estimate is 155% above the consensus -- consider that gap carefully.
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