As of June 14, 2025, Astec Industries Inc has a Discounted Cash Flow (DCF) derived fair value of $56.01 per share. With the current market price at $40.05, this represents a potential upside of 39.8%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $51.21 |
| DCF Fair Value (10-year) | $56.01 |
| Potential Upside (5-year) | 27.9% |
| Potential Upside (10-year) | 39.8% |
| Discount Rate (WACC) | 7.4% - 10.5% |
Revenue is projected to grow from $1305 million in 12-2024 to $1997 million by 12-2034, representing a compound annual growth rate of approximately 4.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 1305 | 2% |
| 12-2025 | 1383 | 6% |
| 12-2026 | 1444 | 4% |
| 12-2027 | 1473 | 2% |
| 12-2028 | 1531 | 4% |
| 12-2029 | 1592 | 4% |
| 12-2030 | 1704 | 7% |
| 12-2031 | 1738 | 2% |
| 12-2032 | 1806 | 4% |
| 12-2033 | 1863 | 3% |
| 12-2034 | 1997 | 7% |
Net profit margin is expected to improve from 0% in 12-2024 to 7% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 4 | 0% |
| 12-2025 | 28 | 2% |
| 12-2026 | 46 | 3% |
| 12-2027 | 63 | 4% |
| 12-2028 | 83 | 5% |
| 12-2029 | 103 | 7% |
| 12-2030 | 111 | 7% |
| 12-2031 | 113 | 7% |
| 12-2032 | 117 | 7% |
| 12-2033 | 121 | 7% |
| 12-2034 | 130 | 7% |
with a 5-year average of $26 million. Projected CapEx is expected to maintain at approximately 2% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 29 |
| 12-2026 | 31 |
| 12-2027 | 29 |
| 12-2028 | 29 |
| 12-2029 | 32 |
| 12-2030 | 33 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 45 |
| Days Inventory | 155 |
| Days Payables | 37 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2025 | 56 | 6 | 22 | (8) | 36 |
| 2026 | 100 | 12 | 31 | 26 | 31 |
| 2027 | 121 | 17 | 31 | 8 | 65 |
| 2028 | 146 | 22 | 33 | 7 | 84 |
| 2029 | 175 | 28 | 34 | 17 | 96 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 51.21 | 27.9% |
| 10-Year DCF (Growth) | 56.01 | 39.8% |
| 5-Year DCF (EBITDA) | 42.92 | 7.2% |
| 10-Year DCF (EBITDA) | 52.09 | 30.1% |
Is Astec Industries Inc (ASTE) a buy or a sell? Astec Industries Inc is definitely a buy. Based on our DCF analysis, Astec Industries Inc (ASTE) appears to be significantly undervalued with upside potential of 39.8%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a strong buy at the current market price of $40.05.