What is BGFV's DCF valuation?

Big 5 Sporting Goods Corp (BGFV) DCF Valuation Analysis

Executive Summary

As of April 4, 2026, Big 5 Sporting Goods Corp has a Discounted Cash Flow (DCF) derived fair value of $0.00 per share. With the current market price at $1.44, this represents a potential upside of -881.8%.

Key Metrics Value
DCF Fair Value (5-year) $0.00
DCF Fair Value (10-year) $0.00
Potential Upside (5-year) -1020.8%
Potential Upside (10-year) -881.8%
Discount Rate (WACC) 7.4% - 9.5%

Financial Performance & Projections

Revenue Trends

Revenue is projected to grow from $795 million in 12-2024 to $1030 million by 12-2034, representing a compound annual growth rate of approximately 2.6%.

Fiscal Year Revenue (USD millions) Growth
12-2024 795 10%
12-2025 729 -8%
12-2026 744 2%
12-2027 800 8%
12-2028 835 4%
12-2029 862 3%
12-2030 883 2%
12-2031 901 2%
12-2032 944 5%
12-2033 1007 7%
12-2034 1030 2%

Profitability Projections

Net profit margin is expected to improve from -9% in 12-2024 to 0% by 12-2034, driven by operational efficiency and economies of scale.

Fiscal Year Net Profit (USD millions) Profit Margin
12-2024 (69) -9%
12-2025 (32) -4%
12-2026 (24) -3%
12-2027 (18) -2%
12-2028 (10) -1%
12-2029 (2) 0%
12-2030 (2) 0%
12-2031 (2) 0%
12-2032 (2) 0%
12-2033 (3) 0%
12-2034 (3) 0%

DCF Model Components

1. Capital Expenditures (CapEx)

with a 5-year average of $11 million. Projected CapEx is expected to maintain at approximately 1% of revenue.

2. Depreciation & Amortization

Depreciation is based on an average useful life of 5 years for capital assets.

Fiscal Year D&A (USD millions)
12-2025 11
12-2026 10
12-2027 9
12-2028 9
12-2029 9
12-2030 9

3. Working Capital Requirements

Net working capital is expected to increase gradually, with projected changes affecting free cash flow.

Components Average Days
Days Receivables 4
Days Inventory 169
Days Payables 39

4. Free Cash Flow Projections

Fiscal Year EBITDA Tax CapEx Change in NWC FCF
6M/2025 (15) (5) 4 (6) (8)
2026 (21) (8) 8 (1) (21)
2027 (13) (6) 9 8 (25)
2028 (3) (3) 9 6 (16)
2029 7 (1) 10 2 (4)

DCF Valuation Parameters

Key Assumptions

  • Discount Rate (WACC): WACC / Discount Rate (selected: 7.4% - 9.5%)
  • Long-Term Growth Rate: Long-term Growth Rate (selected: 1.0% - 3.0%)
  • Terminal EV/EBITDA Multiple: 6.4x (based on peer average)

Valuation Summary

Valuation Method Fair Price (USD) Potential Upside
5-Year DCF (Growth) 0.00 -1020.8%
10-Year DCF (Growth) 0.00 -881.8%
5-Year DCF (EBITDA) 0.00 -100.0%
10-Year DCF (EBITDA) 0.00 -100.0%

Enterprise Value Breakdown

  • 5-Year Model: $(226)M
  • 10-Year Model: $(180)M

Investment Conclusion

Is Big 5 Sporting Goods Corp (BGFV) a buy or a sell? Big 5 Sporting Goods Corp is definitely a sell. Based on our DCF analysis, Big 5 Sporting Goods Corp (BGFV) appears to be overvalued with upside potential of -881.8%. 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:

  • Expanding profit margins (from -9% to 0%)
  • Steady revenue growth (2.6% CAGR)
  • Strong free cash flow generation

Investors should consider reducing exposure at the current market price of $1.44.