UPBD
Upbound Group, Inc.
$18.98
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 45.0% below fair value
You pay
$18.98
Bear
$25.82
Fair
$34.52
Bull
$42.01
Bear
$25.82
+36.0%
3% stage 1 growth, 12% discount
Fair
$34.52
+81.9%
5% stage 1 growth, 12% discount
Bull
$42.01
+121.4%
7% stage 1 growth, 12% discount
Adjust Assumptions
5.2%
12.0%
3.0%
Key Value Driver
FCF growth rate (5% base case)
Terminal Value % of EV
30%
Implied Market Multiple
10.1x
Market is pricing in (growth)
1.2%
vs 5.2% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (20 analysts)
$28.00
Divergence from AlphaVal
23%
Summary
Using a two-stage FCF DCF with 5% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $34.52 per share.
Warnings
Stock-based employee pay equals 62% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
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