TNK
Teekay Tankers Ltd.
$77.21
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 47.3% below fair value
You pay
$77.21
Bear
$129.15
Fair
$146.62
Bull
$161.69
Bear
$129.15
+67.3%
3% stage 1 growth, 11% discount
Fair
$146.62
+89.9%
5% stage 1 growth, 11% discount
Bull
$161.69
+109.4%
7% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (5% base case)
Terminal Value % of EV
35%
Implied Market Multiple
5.7x
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 $86.00 from 23 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $146.62 per share.
Warnings
Wall Street's average price target is $86.00 (from 23 analysts). Our estimate is 94% above 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