What is BCVN.SW's Intrinsic value?

Banque Cantonale Vaudoise (BCVN.SW) Intrinsic Value Analysis

Executive Summary

As of June 17, 2025, Banque Cantonale Vaudoise's estimated intrinsic value ranges from $93.93 to $196.29 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Multi-Stage) $93.93 +4.5%
Dividend Discount Model (Stable) $196.29 +118.3%

Is Banque Cantonale Vaudoise (BCVN.SW) undervalued or overvalued?

With the current market price at $89.90, 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 Banque Cantonale Vaudoise's intrinsic value, including:

  1. Dividend Discount Model (DDM): Values the company based on expected future dividend payments

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 1.1% 1.6%
Equity market risk premium 4.7% 5.7%
Adjusted beta 0.51 0.64
Cost of equity 3.5% 5.8%
Cost of debt 5.0% 5.0%
Tax rate 13.9% 16.5%
Debt/Equity ratio 1.28 1.28
After-tax WACC 4.0% 4.9%

Valuation Methods

2. Dividend Discount Model (DDM)

The DDM values a company based on its expected future dividend payments. We used two approaches:

Multi-Stage DDM:

  • Current payout ratio: 0.0%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 4.7%
  • Long-term growth rate: 0.5%
  • Fair value: $93.93 (4.5% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 5.8% (Low) to 3.5% (High)
  • Long-term growth rate: 0.0% (Low) to 1.0% (High)
  • Fair value range: $99 to $294
  • Selected fair value: $196.29 (118.3% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $7737M
Enterprise Value $7737M
Trailing P/E 0.00
Forward P/E 19.74
Trailing EV/EBITDA 0.00
Current Dividend Yield 367.15%
Dividend Growth Rate (5Y) 1.82%
Debt-to-Equity Ratio 1.28

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
Dividend Discount Model (Multi-Stage) 57% $18.79
Dividend Discount Model (Stable) 43% $29.44
Weighted Average 100% $137.80

Investment Conclusion

Based on our comprehensive valuation analysis, Banque Cantonale Vaudoise's weighted average intrinsic value is $137.80, which is approximately 53.3% above the current market price of $89.90.

Key investment considerations:

  • Historical dividend growth of 1.82%

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