WCC
WESCO International, Inc.
$329.16
Platform & Compounding FCF
50%
Two-stage FCF DCF
Strong
·
Conviction
Overvalued
Trading 174.6% above fair value
You pay
$329.16
Bear
$0.00
Fair
$119.87
Bull
$32.20
Bear
$0.00
-100.0%
6% stage 1 growth, 12% discount
Fair
$119.87
-63.6%
10% stage 1 growth, 12% discount
Bull
$32.20
-90.2%
13% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (10% base case)
Terminal Value % of EV
34%
Implied Market Multiple
61.8x
Market is pricing in (growth)
26.2%
vs 9.7% 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 $399.56 from 33 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $119.87 per share.
Warnings
Wall Street's average price target is $399.56 (from 33 analysts). Our estimate is 100% 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