SQM
Sociedad Química y Minera de Chile S.A.
$66.87
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 6.9% below fair value
You pay
$66.87
Bear
$37.26
Fair
$71.85
Bull
$114.23
Bear
$37.26
-44.3%
11% stage 1 growth, 11% discount
Fair
$71.85
+7.4%
19% stage 1 growth, 11% discount
Bull
$114.23
+70.8%
25% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (19% base case)
Terminal Value % of EV
46%
Implied Market Multiple
41.8x
Market is pricing in (growth)
18.8%
vs 18.9% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $84.50 from 16 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $71.85 per share.
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