As of June 21, 2025, Adams Resources & Energy Inc's estimated intrinsic value ranges from $157.95 to $1650.77 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $1650.77 | +4246.4% |
| Discounted Cash Flow (5Y) | $1282.69 | +3277.3% |
| Dividend Discount Model (Multi-Stage) | $904.36 | +2281.1% |
| Earnings Power Value | $157.95 | +315.9% |
Is Adams Resources & Energy Inc (AE) undervalued or overvalued?
With the current market price at $37.98, 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 Adams Resources & Energy Inc'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 | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.34 | 0.53 |
| Cost of equity | 5.4% | 7.8% |
| Cost of debt | 5.8% | 7.0% |
| Tax rate | 30.9% | 43.8% |
| Debt/Equity ratio | 0.49 | 0.49 |
| After-tax WACC | 5.0% | 6.6% |
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 | $1,283 | $3,308M | 87.9% |
| 10-Year Growth | $1,651 | $4,253M | 75.0% |
| 5-Year EBITDA | $655 | $1,693M | 76.4% |
| 10-Year EBITDA | $931 | $2,402M | 55.8% |
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 | $24M |
| Discount Rate (WACC) | 6.6% - 5.0% |
| Enterprise Value | $360M - $474M |
| Net Debt | $11M |
| Equity Value | $349M - $463M |
| Outstanding Shares | 3M |
| Fair Value | $136 - $180 |
| Selected Fair Value | $157.95 |
| Metric | Value |
|---|---|
| Market Capitalization | $98M |
| Enterprise Value | $109M |
| Trailing P/E | 0.00 |
| Forward P/E | 2.82 |
| Trailing EV/EBITDA | 6.50 |
| Current Dividend Yield | 259.81% |
| Dividend Growth Rate (5Y) | -10.80% |
| Debt-to-Equity Ratio | 0.49 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 35% | $495.23 |
| Discounted Cash Flow (5Y) | 29% | $320.67 |
| Dividend Discount Model (Multi-Stage) | 24% | $180.87 |
| Earnings Power Value | 12% | $15.79 |
| Weighted Average | 100% | $1191.26 |
Based on our comprehensive valuation analysis, Adams Resources & Energy Inc's weighted average intrinsic value is $1191.26, which is approximately 3036.5% above the current market price of $37.98.
Key investment considerations:
Given these factors, we believe Adams Resources & Energy Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.