SRDX
Surmodics, Inc.
$42.98
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 194.3% above fair value
You pay
$42.98
Bear
$11.69
Fair
$14.60
Bull
$17.53
Bear
$11.69
-72.8%
$0.55 × 12x P/E
Fair
$14.60
-66.0%
$0.55 × 15x P/E
Bull
$17.53
-59.2%
$0.55 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
77.6x
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 $39.50 from 7 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $14.60 per share.
Warnings
Wall Street's average price target is $39.50 (from 7 analysts). Our estimate is 79% below 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