THR
Thermon Group Holdings, Inc.
$61.14
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 178.5% above fair value
You pay
$61.14
Bear
$16.95
Fair
$21.95
Bull
$26.42
Bear
$16.95
-72.3%
4% stage 1 growth, 11% discount
Fair
$21.95
-64.1%
7% stage 1 growth, 11% discount
Bull
$26.42
-56.8%
8% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (7% base case)
Terminal Value % of EV
36%
Implied Market Multiple
79.4x
Market is pricing in (growth)
27.4%
vs 6.5% 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 $57.00 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $21.95 per share.
Warnings
Wall Street's average price target is $57.00 (from 15 analysts). Our estimate is 82% 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