VSH
Vishay Intertechnology, Inc.
$47.25
Cyclical & Capital-Intensive
80%
Normalized Earnings × Cycle Multiple
Strong
·
Conviction
Overvalued
Trading 72.4% above fair value
You pay
$47.25
Bear
$19.38
Fair
$27.40
Bull
$35.42
Bear
$19.38
-59.0%
$2.05 × 12x + net cash
Fair
$27.40
-42.0%
$2.05 × 16x + net cash
Bull
$35.42
-25.0%
$2.05 × 20x + net cash
Key Value Driver
Through-cycle normalized EPS ($2.05)
Implied Market Multiple
23.0x
Summary
Our base-case estimate uses Normalized Earnings × Cycle Multiple. We then blend that result with the average analyst price target of $25.00 from 10 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $27.40 per share.
Warnings
Price-to-book value of 3.5x is above the normal range for this type of business (0.7x-2.0x). The stock may already price in a strong cycle.
Key Risks
- Standard 10-year DCF produces unreliable terminal values for cyclicals
- 'Cheap' P/E at cycle peak is the most common value trap — normalize first
- Captive finance subsidiaries have different risk profiles from manufacturing