TRNS
Transcat, Inc.
$73.02
Platform & Compounding FCF
50%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 15.9% above fair value
You pay
$73.02
Bear
$44.82
Fair
$62.98
Bull
$80.79
Bear
$44.82
-38.6%
6% stage 1 growth, 11% discount
Fair
$62.98
-13.8%
10% stage 1 growth, 11% discount
Bull
$80.79
+10.6%
13% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (10% base case)
Terminal Value % of EV
39%
Implied Market Multiple
31.6x
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 $123.60 from 10 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $62.98 per share.
Warnings
Wall Street's average price target is $123.60 (from 10 analysts). Our estimate is 61% 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