What is ALDAR.PA's Intrinsic value?

Damartex SA (ALDAR.PA) Intrinsic Value Analysis

Executive Summary

As of June 15, 2025, Damartex SA's estimated intrinsic value ranges from $101.32 to $138.98 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $138.98 +2921.3%
Earnings Power Value $101.32 +2102.6%

Is Damartex SA (ALDAR.PA) undervalued or overvalued?

With the current market price at $4.60, 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 Damartex SA's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. Earnings Power Value (EPV): Values the company based on its current earnings power, assuming no growth

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 3.0% 3.5%
Equity market risk premium 5.8% 6.8%
Adjusted beta 0.66 0.97
Cost of equity 6.8% 10.6%
Cost of debt 4.0% 7.0%
Tax rate 8.1% 16.2%
Debt/Equity ratio 4.2 4.2
After-tax WACC 4.3% 6.8%

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: 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 5.5% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $529 (FY06-2024) to $2,000 (FY06-2034)
  • Net profit margin expansion from -6% to 2%
  • Capital expenditures maintained at approximately 2% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $(1,234) $40M 222.2%
10-Year Growth $139 $1,791M 94.2%
5-Year EBITDA $(1,234) $89M 155.5%
10-Year EBITDA $21 $419M 75.2%

3. Earnings Power Value (EPV)

EPV assesses a company's value based on its current normalized earnings power, assuming no growth.

EPV Component Value
Normalized Earnings $71M
Discount Rate (WACC) 6.8% - 4.3%
Enterprise Value $1,048M - $1,660M
Net Debt $179M
Equity Value $869M - $1,481M
Outstanding Shares 12M
Fair Value $75 - $128
Selected Fair Value $101.32

Key Financial Metrics

Metric Value
Market Capitalization $53M
Enterprise Value $232M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 5.05
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) -63.84%
Debt-to-Equity Ratio 4.20

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) 75% $41.69
Earnings Power Value 25% $10.13
Weighted Average 100% $129.56

Investment Conclusion

Based on our comprehensive valuation analysis, Damartex SA's weighted average intrinsic value is $129.56, which is approximately 2716.6% above the current market price of $4.60.

Key investment considerations:

  • Strong projected earnings growth (-6% to 2% margin)

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