SAF.PA · PAR · Industrials
Safran SA
Also onConsensus Drift
Implied value per share
EUR 254.14
Market price
EUR 323.00
Implied upside
-21.3%
5-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case
Current EV/EBITDA of 21.8x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.
Value Per Share
Same forecast, different terminal treatment. Percentages vs price.
Forecast Cashflows
Reporting currency (EUR). Outflows negative.
| Line | FY26 | FY27 | FY28 | FY29 | FY30 | CAGR |
|---|---|---|---|---|---|---|
| Revenue | EUR 36.5bn | EUR 42.6bn | EUR 49.8bn | EUR 58.2bn | EUR 68.1bn | +16.9% |
| EBIT | EUR 5.1bn | EUR 6.0bn | EUR 7.0bn | EUR 8.2bn | EUR 9.6bn | +16.9% |
| NOPAT | EUR 3.8bn | EUR 4.5bn | EUR 5.2bn | EUR 6.1bn | EUR 7.1bn | +16.9% |
| Add depreciation & amortisation | EUR 2.2bn | EUR 2.6bn | EUR 3.0bn | EUR 3.5bn | EUR 4.1bn | +16.9% |
| Less capital expenditure | EUR -2.0bn | EUR -2.3bn | EUR -2.7bn | EUR -3.1bn | EUR -3.7bn | +16.9% |
| Less increase in working capital | EUR 967.9m | EUR 1.1bn | EUR 1.3bn | EUR 1.5bn | EUR 1.8bn | -16.9% |
| Free cashflow to firm | EUR 5.1bn | EUR 5.9bn | EUR 6.9bn | EUR 8.1bn | EUR 9.4bn | +16.9% |
| Discount factor | 0.9588 | 0.8815 | 0.8104 | 0.7450 | 0.6850 | - |
| Present value | EUR 4.8bn | EUR 5.2bn | EUR 5.6bn | EUR 6.0bn | EUR 6.5bn | +7.5% |
| Present Value Of The Forecast | EUR 28.1bn | |||||
Discount Rate
Source shown per component. All overridable above.
| Risk-free rate | 3.20% | EUR assumption - no free live source available for this market (assumption) |
| Equity risk premium | 6.00% | Market assumption |
| Beta | 0.971 | Reported 0.957, pulled toward 1.0 (Blume) |
| Cost of equity | 9.03% | Risk-free + beta x equity risk premium |
| Cost of debt | 3.20% | Floored at the risk-free rate (implied cost of debt was lower) |
| Market capitalisation | EUR 133.8bn | 96.2% of capital |
| Total debt | EUR 5.3bn | 3.8% of capital, book value as a proxy |
| Tax rate | 25.8% | Effective, capped at statutory |
| WACC | 8.77% | 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%
73% of EV
- Forecast FCFF, final year
- EUR 9.4bn
- Capex at depreciation, working capital in reinvestment
- EUR 8.2bn
- Less reinvestment at g/ROIC (16.1% of NOPAT)
- EUR -1.3bn
- Capitalised
- EUR 6.8bn
- ROIC (reported)
- 15.5%
- Terminal value, undiscounted
- EUR 111.7bn
- Terminal value, discounted
- EUR 76.5bn
- Enterprise value
- EUR 104.6bn
- Less net debt
- EUR -1.6bn
- Equity value
- EUR 106.2bn
Exit at 20.0x EBITDA
87% of EV
- Terminal value, undiscounted
- EUR 275.1bn
- Terminal value, discounted
- EUR 188.4bn
- Enterprise value
- EUR 216.5bn
- Less net debt
- EUR -1.6bn
- Equity value
- EUR 218.1bn
Spread between methods: 69%.
Sensitivity
Value per share (EUR) by discount rate and long-run growth.
| Long-run growth | |||||
|---|---|---|---|---|---|
| Discount rate | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
| 6.77% | 326.98 | 344.79 | 366.66 | 394.20 | 430.01 |
| 7.77% | 276.27 | 287.04 | 299.78 | 315.08 | 333.87 |
| 8.77% | 239.47 | 246.29 | 254.14 | 263.27 | 274.06 |
| 9.77% | 211.53 | 215.99 | 220.99 | 226.68 | 233.21 |
| 10.77% | 189.60 | 192.55 | 195.81 | 199.43 | 203.50 |
Outlined: this model. Green text: above today's price of 323.00. 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.
| Input | Model | Implied | Gap |
|---|---|---|---|
| Revenue growth, every year | 16.9% | 23.0% | +6.1pp |
| EBIT margin | 14.1% | 18.7% | +4.6pp |
| Discount rate | 8.8% | 7.4% | -1.4pp |
Live formulas, not pasted numbers - edit a driver and the workbook reprices.
Yahoo Finance and RBA data. General information, not advice. Methodology.