TDG
TransDigm Group Incorporated
$1,104.84
Platform & Compounding FCF
70%
Two-stage FCF DCF
Moderate
·
Conviction
Undervalued
Trading 25.2% below fair value
You pay
$1,104.84
Bear
$690.09
Fair
$1,476.21
Bull
$2,394.83
Bear
$690.09
-37.5%
10% stage 1 growth, 11% discount
Fair
$1,476.21
+33.6%
17% stage 1 growth, 11% discount
Bull
$2,394.83
+116.8%
22% stage 1 growth, 11% discount
Adjust Assumptions
17.0%
11.0%
3.0%
Key Value Driver
FCF growth rate (17% base case)
Terminal Value % of EV
44%
Implied Market Multiple
29.5x
Market is pricing in (growth)
14.2%
vs 17.0% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (39 analysts)
$1461.22
Divergence from AlphaVal
1%
Summary
Using a two-stage FCF DCF with 17% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $1476.21 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