As of June 17, 2025, Adaro Energy Tbk PT's estimated intrinsic value ranges from $3039.95 to $6982.32 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $3890.80 | +94.5% |
| Discounted Cash Flow (5Y) | $3715.57 | +85.8% |
| Dividend Discount Model (Multi-Stage) | $5440.97 | +172.0% |
| Dividend Discount Model (Stable) | $3039.95 | +52.0% |
| Earnings Power Value | $6982.32 | +249.1% |
Is Adaro Energy Tbk PT (ADRO.JK) undervalued or overvalued?
With the current market price at $2000.00, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Adaro Energy Tbk PT'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 | 6.6% | 7.1% |
| Equity market risk premium | 7.9% | 8.9% |
| Adjusted beta | 1.02 | 1.11 |
| Cost of equity | 14.6% | 17.5% |
| Cost of debt | 4.0% | 7.0% |
| Tax rate | 25.7% | 29.5% |
| Debt/Equity ratio | 0.15 | 0.15 |
| After-tax WACC | 13.1% | 15.8% |
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 | $0 | $6,474M | 52.1% |
| 10-Year Growth | $0 | $6,805M | 27.9% |
| 5-Year EBITDA | $0 | $12,135M | 74.4% |
| 10-Year EBITDA | $0 | $10,151M | 51.7% |
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 | $1,810M |
| Discount Rate (WACC) | 15.8% - 13.1% |
| Enterprise Value | $11,435M - $13,846M |
| Net Debt | $(540)M |
| Equity Value | $11,975M - $14,385M |
| Outstanding Shares | 30,759M |
| Fair Value | $0 - $0 |
| Selected Fair Value | $6982.32 |
| Metric | Value |
|---|---|
| Market Capitalization | $61517400M |
| Enterprise Value | $52724570M |
| Trailing P/E | 3.49 |
| Forward P/E | 4.34 |
| Trailing EV/EBITDA | 9.50 |
| Current Dividend Yield | 8575.61% |
| Dividend Growth Rate (5Y) | 92.43% |
| Debt-to-Equity Ratio | 0.15 |
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% | $1167.24 |
| Discounted Cash Flow (5Y) | 25% | $928.89 |
| Dividend Discount Model (Multi-Stage) | 20% | $1088.19 |
| Dividend Discount Model (Stable) | 15% | $455.99 |
| Earnings Power Value | 10% | $698.23 |
| Weighted Average | 100% | $4338.55 |
Based on our comprehensive valuation analysis, Adaro Energy Tbk PT's weighted average intrinsic value is $4338.55, which is approximately 116.9% above the current market price of $2000.00.
Key investment considerations:
Given these factors, we believe Adaro Energy Tbk PT is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.