SYK
Stryker Corporation
$317.71
Platform & Compounding FCF
65%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 21.7% above fair value
You pay
$317.71
Bear
$173.85
Fair
$261.01
Bull
$350.74
Bear
$173.85
-45.3%
7% stage 1 growth, 11% discount
Fair
$261.01
-17.8%
12% stage 1 growth, 11% discount
Bull
$350.74
+10.4%
15% stage 1 growth, 11% discount
Adjust Assumptions
11.8%
11.0%
3.0%
Key Value Driver
FCF growth rate (12% base case)
Terminal Value % of EV
40%
Implied Market Multiple
29.5x
Market is pricing in (growth)
14.2%
vs 11.8% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (52 analysts)
$381.59
Divergence from AlphaVal
32%
Summary
Using a two-stage FCF DCF with 12% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $261.01 per share.
Warnings
Wall Street's average price target is $381.59 (from 52 analysts). Our estimate is 32% 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