As of December 15, 2025, Breedon Group PLC's estimated intrinsic value ranges from $298.67 to $1643.91 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $386.43 | +19.9% |
| Discounted Cash Flow (5Y) | $348.18 | +8.0% |
| Dividend Discount Model (Multi-Stage) | $339.01 | +5.2% |
| Dividend Discount Model (Stable) | $298.67 | -7.4% |
| Earnings Power Value | $1643.91 | +409.9% |
Is Breedon Group PLC (BREE.L) undervalued or overvalued?
With the current market price at $322.40, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Breedon 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 | 0.92 | 1.03 |
| Cost of equity | 9.5% | 12.2% |
| Cost of debt | 4.0% | 5.1% |
| Tax rate | 22.5% | 25.9% |
| Debt/Equity ratio | 0.39 | 0.39 |
| After-tax WACC | 7.7% | 9.8% |
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 | $348 | $1,859M | 77.4% |
| 10-Year Growth | $386 | $1,992M | 59.2% |
| 5-Year EBITDA | $247 | $1,506M | 72.1% |
| 10-Year EBITDA | $301 | $1,695M | 52.1% |
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 | $551M |
| Discount Rate (WACC) | 9.8% - 7.7% |
| Enterprise Value | $5,600M - $7,128M |
| Net Debt | $648M |
| Equity Value | $4,952M - $6,480M |
| Outstanding Shares | 3M |
| Fair Value | $1,424 - $1,864 |
| Selected Fair Value | $1643.91 |
| Metric | Value |
|---|---|
| Market Capitalization | $1121M |
| Enterprise Value | $1769M |
| Trailing P/E | 12.51 |
| Forward P/E | 10.91 |
| Trailing EV/EBITDA | 5.25 |
| Current Dividend Yield | 453.15% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.39 |
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% | $115.93 |
| Discounted Cash Flow (5Y) | 25% | $87.04 |
| Dividend Discount Model (Multi-Stage) | 20% | $67.80 |
| Dividend Discount Model (Stable) | 15% | $44.80 |
| Earnings Power Value | 10% | $164.39 |
| Weighted Average | 100% | $479.97 |
Based on our comprehensive valuation analysis, Breedon Group PLC's intrinsic value is $479.97, which is approximately 48.9% above the current market price of $322.40.
Key investment considerations:
Given these factors, we believe Breedon Group PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.