AlphaMadera's AlphaVal page classifies Arcus Biosciences, Inc. as a High-Growth Software business and values it using Revenue × Terminal Margin DCF, then compares the result to the current market price to flag RCUS as undervalued, fairly valued, or overvalued.

What is Arcus Biosciences, Inc.'s fair value?

Fair value for RCUS comes from a Revenue × Terminal Margin DCF model -- the approach AlphaVal selected for this company's High-Growth Software classification. The live AlphaVal page shows bear, base, and bull scenarios alongside the key assumption behind each.

How does AlphaMadera value RCUS?

AlphaVal routes each company to one of ten valuation archetypes based on its business model. RCUS was classified as High-Growth Software and is valued using Revenue × Terminal Margin DCF, built from RCUS's most recent reported fundamentals.

RCUS - Arcus Biosciences, Inc.

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $39.17 DETAILS

AlphaVal

Deterministic, archetype-aware fair value

High-Growth Software 80% confidence

Primary model: Revenue × Terminal Margin DCF

Valuation Signal Overvalued Moderate

Trading 37.0% above fair value

Current Price $29.28

Bear Case $12.44 57.5% downside ($12.44 - $29.28) / $29.28 = -57.5% 16% rev growth, 21% terminal margin

Fair Value $21.37 27.0% downside ($21.37 - $29.28) / $29.28 = -27.0% 26% rev growth, 28% terminal margin

Bull Case $32.70 11.7% upside ($32.70 - $29.28) / $29.28 = 11.7% 34% rev growth, 32% terminal margin

Adjust Assumptions

Revenue Growth Rate

26.0%

Terminal FCF Margin

28.0%

Discount Rate

12.0%

Key Value Driver

Revenue growth (26%) × margin expansion to 28%

Terminal Value % of EV 69%

Implied Market Multiple 11.4x

Market is pricing in (growth)

Plain-Language Summary

Projecting 26% revenue growth with FCF margins expanding from 0% to 28% over 10 years, discounted at 12%, the base-case value is $21.37 per share.

Analyst Consensus (External Reference)

Never blended into the bear/base/bull estimates above -- shown only as an outside comparison.

Average Target (18 analysts) $39.17

Analyst Range $23.00 – $47.00

Divergence from AlphaVal 45%

Warnings

⚠ Stock-based employee pay is 24% of revenue — your ownership shrinks by about 2.0% each year as new shares are issued. Our estimate already accounts for this dilution.

⚠ Our estimate assumes profit margins grow from 0% to 28% over 10 years. If that improvement stalls, the company is worth considerably less.

ℹ Gross margin of 96% means each dollar of revenue is highly profitable. As the company grows, overhead costs should shrink as a share of revenue, boosting overall profits.

ℹ Wall Street's average price target is $39.17 (from 18 analysts). Our estimate is 45% below the consensus -- consider that gap carefully.

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