As of September 10, 2025, Ashtead Group PLC's estimated intrinsic value ranges from $4508.86 to $17995.24 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $8638.90 | +57.8% |
| Discounted Cash Flow (5Y) | $7121.62 | +30.1% |
| Dividend Discount Model (Multi-Stage) | $4508.86 | -17.6% |
| Dividend Discount Model (Stable) | $4601.41 | -15.9% |
| Earnings Power Value | $17995.24 | +228.7% |
Is Ashtead Group PLC (AHT.L) undervalued or overvalued?
With the current market price at $5474.00, 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 Ashtead Group 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 | 0.43 | 0.58 |
| Cost of equity | 6.6% | 9.0% |
| Cost of debt | 4.9% | 5.2% |
| Tax rate | 24.7% | 25.0% |
| Debt/Equity ratio | 0.45 | 0.45 |
| After-tax WACC | 5.7% | 7.5% |
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 | $7,122 | $40,086M | 77.1% |
| 10-Year Growth | $8,639 | $46,439M | 61.4% |
| 5-Year EBITDA | $3,001 | $22,831M | 59.8% |
| 10-Year EBITDA | $4,824 | $30,464M | 41.1% |
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 | $5,515M |
| Discount Rate (WACC) | 7.5% - 5.7% |
| Enterprise Value | $74,012M - $97,217M |
| Net Debt | $10,268M |
| Equity Value | $63,745M - $86,949M |
| Outstanding Shares | 4M |
| Fair Value | $15,224 - $20,766 |
| Selected Fair Value | $17995.24 |
| Metric | Value |
|---|---|
| Market Capitalization | $22920M |
| Enterprise Value | $33187M |
| Trailing P/E | 15.46 |
| Forward P/E | 15.03 |
| Trailing EV/EBITDA | 5.20 |
| Current Dividend Yield | 176.77% |
| Dividend Growth Rate (5Y) | 23.29% |
| Debt-to-Equity Ratio | 0.45 |
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% | $2591.67 |
| Discounted Cash Flow (5Y) | 25% | $1780.40 |
| Dividend Discount Model (Multi-Stage) | 20% | $901.77 |
| Dividend Discount Model (Stable) | 15% | $690.21 |
| Earnings Power Value | 10% | $1799.52 |
| Weighted Average | 100% | $7763.58 |
Based on our comprehensive valuation analysis, Ashtead Group PLC's intrinsic value is $7763.58, which is approximately 41.8% above the current market price of $5474.00.
Key investment considerations:
Given these factors, we believe Ashtead Group PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.