What is CLARI.PA's Intrinsic value?

Clariane SE (CLARI.PA) Intrinsic Value Analysis

Executive Summary

As of May 31, 2025, Clariane SE's estimated intrinsic value ranges from $1.85 to $24.32 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $2.30 -39.2%
Dividend Discount Model (Multi-Stage) $1.85 -50.9%
Earnings Power Value $24.32 +544.0%

Is Clariane SE (CLARI.PA) undervalued or overvalued?

With the current market price at $3.78, 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 Clariane SE'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
  3. 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 3.0% 3.5%
Equity market risk premium 5.8% 6.8%
Adjusted beta 0.64 0.78
Cost of equity 6.7% 9.3%
Cost of debt 4.0% 14.8%
Tax rate 16.1% 22.9%
Debt/Equity ratio 6.13 6.13
After-tax WACC 3.8% 11.1%

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: 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 7.5% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $5,282 (FY12-2024) to $10,372 (FY12-2034)
  • Net profit margin expansion from -1% to 1%
  • Capital expenditures maintained at approximately 11% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $(1,234) $5,532M 82.9%
10-Year Growth $2 $8,255M 72.3%
5-Year EBITDA $(1,234) $4,325M 78.2%
10-Year EBITDA $(1,234) $5,824M 60.7%

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: 8.0%
  • Long-term growth rate: 3.3%
  • Fair value: $1.85 (-50.9% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 9.3% (Low) to 6.7% (High)
  • Long-term growth rate: 3.0% (Low) to 3.6% (High)
  • Fair value range: $(2) to $(4)
  • Selected fair value: $-3.08 (-181.5% 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 $916M
Discount Rate (WACC) 11.1% - 3.8%
Enterprise Value $8,258M - $23,931M
Net Debt $7,437M
Equity Value $821M - $16,493M
Outstanding Shares 356M
Fair Value $2 - $46
Selected Fair Value $24.32

Key Financial Metrics

Metric Value
Market Capitalization $1344M
Enterprise Value $8782M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 4.50
Current Dividend Yield 391.19%
Dividend Growth Rate (5Y) -5.96%
Debt-to-Equity Ratio 6.13

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
Discounted Cash Flow (10Y) 50% $0.69
Dividend Discount Model (Multi-Stage) 33% $0.37
Earnings Power Value 17% $2.43
Weighted Average 100% $5.82

Investment Conclusion

Based on our comprehensive valuation analysis, Clariane SE's weighted average intrinsic value is $5.82, which is approximately 54.1% above the current market price of $3.78.

Key investment considerations:

  • Strong projected earnings growth (-1% to 1% margin)
  • Consistent cash flow generation

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