VNET
VNET Group, Inc.
$9.54
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 29.7% above fair value
You pay
$9.54
Bear
$5.89
Fair
$7.36
Bull
$8.82
Bear
$5.89
-38.2%
$0.10 × 16x P/E
Fair
$7.36
-22.9%
$0.10 × 20x P/E
Bull
$8.82
-7.5%
$0.10 × 24x P/E
Key Value Driver
Normalized P/E multiple (20x base case)
Implied Market Multiple
98.2x
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 $23.55 from 16 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $7.36 per share.
Warnings
Wall Street's average price target is $23.55 (from 16 analysts). Our estimate is 92% below the consensus -- consider that gap carefully.
Financial statements were converted from CNY into USD using USDCNY at 0.1472 USD per CNY.
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