As of May 22, 2025, Ab Dynamics PLC's estimated intrinsic value ranges from $697.10 to $1742.00 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $1742.00 | -6.1% |
| Discounted Cash Flow (5Y) | $1284.10 | -30.8% |
| Dividend Discount Model (Multi-Stage) | $1102.26 | -40.6% |
| Dividend Discount Model (Stable) | $697.10 | -62.4% |
| Earnings Power Value | $792.30 | -57.3% |
Is Ab Dynamics PLC (ABDP.L) undervalued or overvalued?
With the current market price at $1855.00, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Ab Dynamics PLC's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.78 | 0.89 |
| Cost of equity | 8.6% | 11.2% |
| Cost of debt | 5.0% | 5.0% |
| Tax rate | 14.9% | 19.4% |
| Debt/Equity ratio | 0.01 | 0.01 |
| After-tax WACC | 8.6% | 11.1% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $1,284 | $265M | 78.8% |
| 10-Year Growth | $1,742 | $369M | 62.7% |
| 5-Year EBITDA | $2,020 | $433M | 87.0% |
| 10-Year EBITDA | $2,464 | $534M | 74.2% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $15M |
| Discount Rate (WACC) | 11.1% - 8.6% |
| Enterprise Value | $134M - $173M |
| Net Debt | $(27)M |
| Equity Value | $161M - $200M |
| Outstanding Shares | 0M |
| Fair Value | $706 - $879 |
| Selected Fair Value | $792.30 |
| Metric | Value |
|---|---|
| Market Capitalization | $422M |
| Enterprise Value | $395M |
| Trailing P/E | 39.73 |
| Forward P/E | 32.92 |
| Trailing EV/EBITDA | 15.30 |
| Current Dividend Yield | 40.69% |
| Dividend Growth Rate (5Y) | 25.08% |
| Debt-to-Equity Ratio | 0.01 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $522.60 |
| Discounted Cash Flow (5Y) | 25% | $321.02 |
| Dividend Discount Model (Multi-Stage) | 20% | $220.45 |
| Dividend Discount Model (Stable) | 15% | $104.57 |
| Earnings Power Value | 10% | $79.23 |
| Weighted Average | 100% | $1247.87 |
Based on our comprehensive valuation analysis, Ab Dynamics PLC's weighted average intrinsic value is $1247.87, which is approximately 32.7% below the current market price of $1855.00.
Key investment considerations:
Given these factors, we believe Ab Dynamics PLC is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.