ZVRA
Zevra Therapeutics, Inc.
$12.06
High-Growth Software
80%
Revenue × Terminal Margin DCF
Moderate
·
Conviction
Undervalued
Trading 39.8% below fair value
You pay
$12.06
Bear
$9.10
Fair
$20.02
Bull
$28.76
Bear
$9.10
-24.6%
18% rev growth, 21% terminal margin
Fair
$20.02
+66.0%
30% rev growth, 28% terminal margin
Bull
$28.76
+138.5%
35% rev growth, 32% terminal margin
Adjust Assumptions
30.0%
28.0%
12.0%
Key Value Driver
Revenue growth (30%) × margin expansion to 28%
Terminal Value % of EV
67%
Implied Market Multiple
5.5x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (10 analysts)
$25.75
Divergence from AlphaVal
22%
Summary
Projecting 30% revenue growth with FCF margins expanding from 5% to 28% over 10 years, discounted at 12%, the base-case value is $20.02 per share.
Warnings
Our estimate assumes profit margins grow from 5% to 28% over 10 years. If that improvement stalls, the company is worth considerably less.
Gross margin of 85% means each dollar of revenue is highly profitable. As the company grows, overhead costs should shrink as a share of revenue, boosting overall profits.
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