YEXT
Yext, Inc.
$3.68
High-Growth Software
80%
Revenue × Terminal Margin DCF
Strong
·
Conviction
Undervalued
Trading 48.5% below fair value
You pay
$3.68
Bear
$7.94
Fair
$7.14
Bull
$8.33
Bear
$7.94
+115.8%
8% rev growth, 17% terminal margin
Fair
$7.14
+94.1%
2% rev growth, 23% terminal margin
Bull
$8.33
+126.4%
3% rev growth, 26% terminal margin
Key Value Driver
Revenue growth (2%) × margin expansion to 23%
Terminal Value % of EV
52%
Implied Market Multiple
1.1x
Summary
Our base-case estimate uses a discounted cash flow model based on revenue growth and long-run free cash flow margins. We then blend that result with the average analyst price target of $8.20 from 17 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $7.14 per share.
Key Risks
- Current FCF misleads — the model values future margins, not today's cash
- SBC dilution is the hidden tax: 2-4% annual share growth compounds fast
- Revenue deceleration is inevitable — the question is when and how steep