SONO
Sonos, Inc.
$17.26
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 150.4% above fair value
You pay
$17.26
Bear
$6.10
Fair
$6.89
Bull
$7.58
Bear
$6.10
-64.6%
3% stage 1 growth, 12% discount
Fair
$6.89
-60.1%
6% stage 1 growth, 12% discount
Bull
$7.58
-56.1%
7% stage 1 growth, 12% discount
Adjust Assumptions
5.5%
12.0%
3.0%
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
31%
Implied Market Multiple
39.5x
Market is pricing in (growth)
20.1%
vs 5.5% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (9 analysts)
$19.00
Divergence from AlphaVal
64%
Summary
Using a two-stage FCF DCF with 6% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $6.89 per share.
Warnings
Wall Street's average price target is $19.00 (from 9 analysts). Our estimate is 64% below 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