UNF
UniFirst Corporation
$271.79
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 70.6% above fair value
You pay
$271.79
Bear
$134.55
Fair
$159.35
Bull
$181.36
Bear
$134.55
-50.5%
4% stage 1 growth, 11% discount
Fair
$159.35
-41.4%
6% stage 1 growth, 11% discount
Bull
$181.36
-33.3%
8% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
36%
Implied Market Multiple
34.0x
Market is pricing in (growth)
16.1%
vs 6.2% 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 $262.00 from 6 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $159.35 per share.
Warnings
Wall Street's average price target is $262.00 (from 6 analysts). Our estimate is 49% 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