SNDR
Schneider National, Inc.
$36.78
Cyclical & Capital-Intensive
80%
Normalized Earnings × Cycle Multiple
Strong
·
Conviction
Overvalued
Trading 177.2% above fair value
You pay
$36.78
Bear
$8.47
Fair
$13.27
Bull
$18.07
Bear
$8.47
-77.0%
$1.34 × 4x + net cash
Fair
$13.27
-63.9%
$1.34 × 6x + net cash
Bull
$18.07
-50.9%
$1.34 × 7x + net cash
Key Value Driver
Through-cycle normalized EPS ($1.34)
Implied Market Multiple
27.4x
Summary
Our base-case estimate uses Normalized Earnings × Cycle Multiple. We then blend that result with the average analyst price target of $36.40 from 25 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $13.27 per share.
Warnings
Price-to-book value of 2.5x is above the normal range for this type of business (0.7x-2.0x). The stock may already price in a strong cycle.
Wall Street's average price target is $36.40 (from 25 analysts). Our estimate is 85% below the consensus -- consider that gap carefully.
Key Risks
- Standard 10-year DCF produces unreliable terminal values for cyclicals
- 'Cheap' P/E at cycle peak is the most common value trap — normalize first
- Captive finance subsidiaries have different risk profiles from manufacturing