What is ADDERA.ST's Intrinsic value?

AdderaCare AB (ADDERA.ST) Intrinsic Value Analysis

Executive Summary

As of December 15, 2025, AdderaCare AB's estimated intrinsic value ranges from $4.62 to $18.62 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $18.62 +417.3%
Discounted Cash Flow (5Y) $4.62 +28.4%
Dividend Discount Model (Multi-Stage) $11.00 +205.7%

Is AdderaCare AB (ADDERA.ST) undervalued or overvalued?

With the current market price at $3.60, 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 AdderaCare AB's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. 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 0.68 0.87
Cost of equity 6.0% 8.8%
Cost of debt 5.0% 5.0%
Tax rate 20.8% 23.9%
Debt/Equity ratio 0.33 0.33
After-tax WACC 5.5% 7.6%

Valuation Methods

1. Discounted Cash Flow (DCF) Valuation

Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:

  • Forecast Period: 5-year DCF and 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 6.5% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $248 (FY12-2021) to $762 (FY12-2031)
  • Net profit margin expansion from 1% to 6%
  • Capital expenditures maintained at approximately 1% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $5 $185M 90.7%
10-Year Growth $19 $657M 85.3%
5-Year EBITDA $3 $142M 87.9%
10-Year EBITDA $7 $281M 65.7%

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: 7.4%
  • Long-term growth rate: 3.5%
  • Fair value: $11.00 (205.7% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 8.8% (Low) to 6.0% (High)
  • Long-term growth rate: 2.5% (Low) to 4.5% (High)
  • Fair value range: $(9) to $(49)
  • Selected fair value: $-28.64 (-895.7% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $121M
Enterprise Value $150M
Trailing P/E 0.00
Forward P/E 26.59
Trailing EV/EBITDA 5.00
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.33

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
Discounted Cash Flow (10Y) 40% $5.59
Discounted Cash Flow (5Y) 33% $1.16
Dividend Discount Model (Multi-Stage) 27% $2.20
Weighted Average 100% $11.92

Investment Conclusion

Based on our comprehensive valuation analysis, AdderaCare AB's intrinsic value is $11.92, which is approximately 231.2% above the current market price of $3.60.

Key investment considerations:

  • Strong projected earnings growth (1% to 6% margin)
  • Consistent cash flow generation

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