TR
Tootsie Roll Industries, Inc.
$37.55
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 51.9% above fair value
You pay
$37.55
Bear
$20.36
Fair
$24.72
Bull
$29.09
Bear
$20.36
-45.8%
$1.37 × 15x P/E
Fair
$24.72
-34.1%
$1.37 × 18x P/E
Bull
$29.09
-22.5%
$1.37 × 21x P/E
Adjust Assumptions
18.0x
1.37$
Key Value Driver
Normalized P/E multiple (18x base case)
Implied Market Multiple
27.4x
Summary
Applying a 18x P/E to adjusted EPS of $1.37, the base-case value is $24.72 per share.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples