What is CGEO.L's Intrinsic value?

Georgia Capital PLC (CGEO.L) Intrinsic Value Analysis

Executive Summary

As of December 15, 2025, Georgia Capital PLC's estimated intrinsic value ranges from $10848.47 to $137131.52 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $129852.17 +4257.5%
Discounted Cash Flow (5Y) $116684.46 +3815.6%
Dividend Discount Model (Multi-Stage) $137131.52 +4501.7%
Dividend Discount Model (Stable) $10848.47 +264.0%

Is Georgia Capital PLC (CGEO.L) undervalued or overvalued?

With the current market price at $2980.00, 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 Georgia Capital PLC's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. 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 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 0.81 1.04
Cost of equity 8.9% 12.3%
Cost of debt 5.0% 5.0%
Tax rate 19.0% 19.0%
Debt/Equity ratio 1 1
After-tax WACC 6.5% 8.2%

Valuation Methods

1. Discounted Cash Flow (DCF) Valuation

Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:

  • Forecast Period: 5-year DCF and 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 7.3% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $1 (FY12-2024) to $(2,932) (FY12-2034)
  • Net profit margin expansion from -1314% to 3120480%
  • Capital expenditures maintained at approximately 112% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $420,457 $142,521M 73.7%
10-Year Growth $467,904 $158,605M 55.1%
5-Year EBITDA $174,120 $59,019M 36.5%
10-Year EBITDA $263,598 $89,350M 20.3%

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: 10.6%
  • Long-term growth rate: 0.5%
  • Fair value: $137131.52 (4501.7% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 12.3% (Low) to 8.9% (High)
  • Long-term growth rate: 0.0% (Low) to 1.0% (High)
  • Fair value range: $25,991 to $52,191
  • Selected fair value: $10848.47 (264.0% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $1010M
Enterprise Value $1009M
Trailing P/E 2.35
Forward P/E 0.18
Trailing EV/EBITDA 2.30
Current Dividend Yield 194.23%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.83

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
Discounted Cash Flow (10Y) 33% $38955.65
Discounted Cash Flow (5Y) 28% $29171.12
Dividend Discount Model (Multi-Stage) 22% $27426.30
Dividend Discount Model (Stable) 17% $1627.27
Weighted Average 100% $107978.16

Investment Conclusion

Based on our comprehensive valuation analysis, Georgia Capital PLC's intrinsic value is $107978.16, which is approximately 3523.4% above the current market price of $2980.00.

Key investment considerations:

  • Strong projected earnings growth (-1314% to 3120480% margin)
  • Consistent cash flow generation

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