DCF Studio

    IMCD.AS · AMS · Basic Materials

    IMCD N.V.

    Also onConsensus Drift

    Implied value per share

    EUR 62.28

    Market price

    EUR 93.30

    Implied upside

    -33.2%

    5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case

    AdjustedReported capital expenditure averages just 0.57% of revenue, which is too low to be the company's real investment - property trusts and similar structures invest through lines that are not reported as capex. Capex has been set to 1.00% of revenue so the forecast is not handed free growth. Override it if the reported figure is right.
    NoteRisk-free rate is an assumption: USD assumption - no free live source available for this market.

    Value Per Share

    Perpetuity growth
    EUR 62.28-33.2%
    Exit multiple
    EUR 97.77+4.8%
    Market price
    EUR 93.30

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (EUR). Outflows negative.

    0m208m416mFY26FY27FY28FY29FY30
    Nominal FCFFDiscounted to todayEUR
    LineFY26FY27FY28FY29FY30CAGR
    RevenueEUR 4.8bnEUR 4.9bnEUR 5.0bnEUR 5.0bnEUR 5.1bn+1.3%
    EBITEUR 440.9mEUR 446.5mEUR 452.1mEUR 457.9mEUR 463.7m+1.3%
    NOPATEUR 330.7mEUR 334.9mEUR 339.1mEUR 343.4mEUR 347.8m+1.3%
    Add depreciation & amortisationEUR 131.6mEUR 133.2mEUR 134.9mEUR 136.6mEUR 138.4m+1.3%
    Less capital expenditureEUR -48.4mEUR -49.0mEUR -49.6mEUR -50.3mEUR -50.9m+1.3%
    Less increase in working capitalEUR -18.1mEUR -18.4mEUR -18.6mEUR -18.8mEUR -19.1m+1.3%
    Free cashflow to firmEUR 395.7mEUR 400.7mEUR 405.8mEUR 410.9mEUR 416.2m+1.3%
    Discount factor0.95870.88120.81000.74450.6843-
    Present valueEUR 379.4mEUR 353.1mEUR 328.7mEUR 306.0mEUR 284.8m-6.9%
    Present Value Of The ForecastEUR 1.7bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.20%USD assumption - no free live source available for this market (assumption)
    Equity risk premium6.50%Market assumption
    Beta0.978Reported 0.967, pulled toward 1.0 (Blume)
    Cost of equity10.56%Risk-free + beta x equity risk premium
    Cost of debt4.20%Floored at the risk-free rate (implied cost of debt was lower)
    Market capitalisationEUR 5.5bn76.2% of capital
    Total debtEUR 1.7bn23.8% of capital, book value as a proxy
    Tax rate25.0%Effective, capped at statutory
    WACC8.79%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareEUR 62.28

    68% of EV

    Forecast FCFF, final year
    EUR 416.2m
    Capex at depreciation, working capital in reinvestment
    EUR 421.5m
    Less reinvestment at g/ROIC (25.3% of NOPAT)
    EUR -106.8m
    Capitalised
    EUR 314.8m
    ROIC (reported)
    9.9%
    Terminal value, undiscounted
    EUR 5.1bn
    Terminal value, discounted
    EUR 3.5bn
    Enterprise value
    EUR 5.2bn
    Less net debt
    EUR 1.5bn
    Equity value
    EUR 3.7bn

    Exit at 13.6x EBITDA

    Value per shareEUR 97.77

    77% of EV

    Terminal value, undiscounted
    EUR 8.2bn
    Terminal value, discounted
    EUR 5.6bn
    Enterprise value
    EUR 7.3bn
    Less net debt
    EUR 1.5bn
    Equity value
    EUR 5.8bn

    Spread between methods: 44%.

    Sensitivity

    Value per share (EUR) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.79%90.4894.2498.80104.49111.84
    7.79%73.1474.9877.1279.6582.72
    8.79%60.5261.3562.2863.3264.52
    9.79%50.9351.2051.4751.7552.03
    10.79%44.0244.2344.4444.6544.86

    Outlined: this model. Green text: above today's price of 93.30. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputModelImpliedGap
    Revenue growth, every year1.3%10.8%+9.6pp
    EBIT margin9.1%13.0%+3.9pp
    Discount rate8.8%7.0%-1.8pp
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.