TTC
The Toro Company
$90.80
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 53.2% above fair value
You pay
$90.80
Bear
$47.41
Fair
$59.26
Bull
$71.11
Bear
$47.41
-47.8%
$3.51 × 12x P/E
Fair
$59.26
-34.7%
$3.51 × 15x P/E
Bull
$71.11
-21.7%
$3.51 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
25.9x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $86.00 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $59.26 per share.
Warnings
Dividend-based valuation: $79.38 (above our primary estimate by 51%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $86.00 (from 11 analysts). Our estimate is 39% below the consensus -- consider that gap carefully.
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