URI
United Rentals, Inc.
$1,098.88
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 163.8% above fair value
You pay
$1,098.88
Bear
$197.39
Fair
$416.59
Bull
$650.85
Bear
$197.39
-82.0%
8% stage 1 growth, 12% discount
Fair
$416.59
-62.1%
14% stage 1 growth, 12% discount
Bull
$650.85
-40.8%
18% stage 1 growth, 12% discount
Adjust Assumptions
13.5%
12.0%
3.0%
Key Value Driver
FCF growth rate (14% base case)
Terminal Value % of EV
37%
Implied Market Multiple
49.1x
Market is pricing in (growth)
23.1%
vs 13.6% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (41 analysts)
$1293.15
Divergence from AlphaVal
68%
Summary
Using a two-stage FCF DCF with 14% growth decelerating over 15 years, discounted at 12%, the base-case intrinsic value is $416.59 per share.
Warnings
Wall Street's average price target is $1293.15 (from 41 analysts). Our estimate is 68% 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