What is ACTI.ST's Intrinsic value?

Active Biotech AB (publ) (ACTI.ST) Intrinsic Value Analysis

Executive Summary

As of May 28, 2025, Active Biotech AB (publ)'s estimated intrinsic value ranges from $8.56 to $8.56 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Stable) $8.56 +3094.4%

Is Active Biotech AB (publ) (ACTI.ST) undervalued or overvalued?

With the current market price at $0.27, the stock appears to be significantly undervalued.

Understanding Intrinsic Value

Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Active Biotech AB (publ)'s intrinsic value, including:

  1. Dividend Discount Model (DDM): Values the company based on expected future dividend payments

Weighted Average Cost of Capital (WACC)

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 2.5% 3.0%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.44 0.66
Cost of equity 4.8% 7.5%
Cost of debt 5.0% 5.0%
Tax rate 20.6% 20.9%
Debt/Equity ratio 0.02 0.02
After-tax WACC 4.8% 7.5%

Valuation Methods

2. Dividend Discount Model (DDM)

The DDM values a company based on its expected future dividend payments. We used two approaches:

Multi-Stage DDM:

  • Current payout ratio: 0.0%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 6.2%
  • Long-term growth rate: 4.0%
  • Fair value: $-1.41 (-627.1% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 7.5% (Low) to 4.8% (High)
  • Long-term growth rate: 3.0% (Low) to 5.0% (High)
  • Fair value range: $(1) to $18
  • Selected fair value: $8.56 (3094.4% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $233M
Enterprise Value $208M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 29.30
Current Dividend Yield 62.96%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.02

Investment Decision Framework

To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:

  1. Forecast Certainty: DCF methods rely on long-term projections, while earnings power value focuses on current normalized earnings
  2. Business Model Alignment: Dividend models are more appropriate for mature companies with established dividend policies
  3. Historical Accuracy: How well each method has predicted fair value historically

Valuation Weight Matrix

Valuation Method Weight Weighted Value
Dividend Discount Model (Stable) 100% $1.28
Weighted Average 100% $8.56

Investment Conclusion

Based on our comprehensive valuation analysis, Active Biotech AB (publ)'s weighted average intrinsic value is $8.56, which is approximately 3094.4% above the current market price of $0.27.

Key investment considerations:

  • Strong projected earnings growth (-479% to -475% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.02)

Given these factors, we believe Active Biotech AB (publ) is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.