SSTK
Shutterstock, Inc.
$7.80
Platform & Compounding FCF
75%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 82.8% below fair value
You pay
$7.80
Bear
$33.91
Fair
$45.36
Bull
$56.25
Bear
$33.91
+334.5%
5% stage 1 growth, 11% discount
Fair
$45.36
+481.2%
9% stage 1 growth, 11% discount
Bull
$56.25
+620.7%
11% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (9% base case)
Terminal Value % of EV
38%
Implied Market Multiple
5.5x
Market is pricing in (growth)
-9.5%
vs 8.8% 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 $67.00 from 20 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $45.36 per share.
Warnings
Stock-based employee pay equals 134% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Wall Street's average price target is $67.00 (from 20 analysts). Our estimate is 43% 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