What is BIMAS.IS's Intrinsic value?

BIM Birlesik Magazalar AS (BIMAS.IS) Intrinsic Value Analysis

Executive Summary

As of June 13, 2025, BIM Birlesik Magazalar AS's estimated intrinsic value ranges from $0.00 to $16.31 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Multi-Stage) $0.00 -100.0%
Dividend Discount Model (Stable) $16.31 -78.5%
Earnings Power Value $6.40 -91.5%

Is BIM Birlesik Magazalar AS (BIMAS.IS) undervalued or overvalued?

With the current market price at $75.75, the stock appears to be significantly overvalued.

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 BIM Birlesik Magazalar AS's intrinsic value, including:

  1. Dividend Discount Model (DDM): Values the company based on expected future dividend payments
  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 21.4% 21.9%
Equity market risk premium 10.2% 11.2%
Adjusted beta 0.51 0.59
Cost of equity 26.6% 29.0%
Cost of debt 5.0% 5.0%
Tax rate 21.8% 22.5%
Debt/Equity ratio 0.13 0.13
After-tax WACC 23.9% 26.0%

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: 52.7%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 27.8%
  • Long-term growth rate: 4.0%
  • Fair value: $0.00 (-100.0% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 29.0% (Low) to 26.6% (High)
  • Long-term growth rate: 3.0% (Low) to 5.0% (High)
  • Fair value range: $13 to $20
  • Selected fair value: $16.31 (-78.5% from current price)

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 $2,372M
Discount Rate (WACC) 26.0% - 23.9%
Enterprise Value $9,114M - $9,915M
Net Debt $5,662M
Equity Value $3,452M - $4,252M
Outstanding Shares 602M
Fair Value $6 - $7
Selected Fair Value $6.40

Key Financial Metrics

Metric Value
Market Capitalization $45566M
Enterprise Value $51228M
Trailing P/E 15.93
Forward P/E 2086977800000.00
Trailing EV/EBITDA 6.15
Current Dividend Yield 330.66%
Dividend Growth Rate (5Y) -2.32%
Debt-to-Equity Ratio 0.13

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) 44% $0.00
Dividend Discount Model (Stable) 33% $2.45
Earnings Power Value 22% $0.64
Weighted Average 100% $6.86

Investment Conclusion

Based on our comprehensive valuation analysis, BIM Birlesik Magazalar AS's weighted average intrinsic value is $6.86, which is approximately 90.9% below the current market price of $75.75.

Key investment considerations:

  • Strong projected earnings growth (5% to 0% margin)
  • Conservative capital structure (Debt/Equity of 0.13)

Given these factors, we believe BIM Birlesik Magazalar AS is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.