As of June 19, 2025, Auto Trader Group PLC's estimated intrinsic value ranges from $418.84 to $924.44 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $924.44 | +14.4% |
| Discounted Cash Flow (5Y) | $789.43 | -2.3% |
| Dividend Discount Model (Multi-Stage) | $652.71 | -19.3% |
| Dividend Discount Model (Stable) | $647.32 | -19.9% |
| Earnings Power Value | $418.84 | -48.2% |
Is Auto Trader Group PLC (AUTO.L) undervalued or overvalued?
With the current market price at $808.40, the stock appears to be fairly valued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Auto Trader 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 | 0.52 | 0.61 |
| Cost of equity | 7.1% | 9.2% |
| Cost of debt | 4.6% | 11.1% |
| Tax rate | 19.7% | 22.1% |
| Debt/Equity ratio | 0 | 0 |
| After-tax WACC | 7.1% | 9.2% |
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 | $789 | $6,671M | 78.0% |
| 10-Year Growth | $924 | $7,814M | 63.1% |
| 5-Year EBITDA | $453 | $3,825M | 61.6% |
| 10-Year EBITDA | $605 | $5,108M | 43.6% |
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 | $283M |
| Discount Rate (WACC) | 9.2% - 7.1% |
| Enterprise Value | $3,070M - $3,997M |
| Net Debt | $(13)M |
| Equity Value | $3,082M - $4,010M |
| Outstanding Shares | 8M |
| Fair Value | $364 - $474 |
| Selected Fair Value | $418.84 |
| Metric | Value |
|---|---|
| Market Capitalization | $6845M |
| Enterprise Value | $6832M |
| Trailing P/E | 24.22 |
| Forward P/E | 21.78 |
| Trailing EV/EBITDA | 6.95 |
| Current Dividend Yield | 127.98% |
| Dividend Growth Rate (5Y) | 7.22% |
| Debt-to-Equity Ratio | 0.00 |
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% | $277.33 |
| Discounted Cash Flow (5Y) | 25% | $197.36 |
| Dividend Discount Model (Multi-Stage) | 20% | $130.54 |
| Dividend Discount Model (Stable) | 15% | $97.10 |
| Earnings Power Value | 10% | $41.88 |
| Weighted Average | 100% | $744.21 |
Based on our comprehensive valuation analysis, Auto Trader Group PLC's weighted average intrinsic value is $744.21, which is approximately 7.9% below the current market price of $808.40.
Key investment considerations:
Given these factors, we believe Auto Trader Group PLC is currently fairly valued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.