As of June 2, 2025, CML Microsystems Plc has a Discounted Cash Flow (DCF) derived fair value of $291.39 per share. With the current market price at $265.00, this represents a potential upside of 10.0%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $134.61 |
| DCF Fair Value (10-year) | $291.39 |
| Potential Upside (5-year) | -49.2% |
| Potential Upside (10-year) | 10.0% |
| Discount Rate (WACC) | 6.6% - 10.0% |
Revenue is projected to grow from $23 million in 03-2024 to $53 million by 03-2034, representing a compound annual growth rate of approximately 8.7%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 03-2024 | 23 | 11% |
| 03-2025 | 25 | 9% |
| 03-2026 | 28 | 12% |
| 03-2027 | 30 | 8% |
| 03-2028 | 32 | 8% |
| 03-2029 | 35 | 8% |
| 03-2030 | 39 | 11% |
| 03-2031 | 42 | 7% |
| 03-2032 | 45 | 9% |
| 03-2033 | 49 | 8% |
| 03-2034 | 53 | 10% |
Net profit margin is expected to improve from 9% in 03-2024 to 15% by 03-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 03-2024 | 2 | 9% |
| 03-2025 | 3 | 10% |
| 03-2026 | 3 | 11% |
| 03-2027 | 4 | 12% |
| 03-2028 | 4 | 13% |
| 03-2029 | 5 | 14% |
| 03-2030 | 6 | 15% |
| 03-2031 | 6 | 15% |
| 03-2032 | 7 | 15% |
| 03-2033 | 7 | 15% |
| 03-2034 | 8 | 15% |
with a 5-year average of $6 million. Projected CapEx is expected to maintain at approximately 39% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 03-2025 | 7 |
| 03-2026 | 7 |
| 03-2027 | 9 |
| 03-2028 | 10 |
| 03-2029 | 12 |
| 03-2030 | 13 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 29 |
| Days Inventory | 228 |
| Days Payables | 52 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2025 | 5 | 0 | 5 | (1) | 1 |
| 2026 | 11 | 1 | 11 | 1 | (2) |
| 2027 | 13 | 1 | 12 | 1 | (1) |
| 2028 | 15 | 1 | 12 | (0) | 1 |
| 2029 | 17 | 1 | 13 | 1 | 2 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 134.61 | -49.2% |
| 10-Year DCF (Growth) | 291.39 | 10.0% |
| 5-Year DCF (EBITDA) | 777.51 | 193.4% |
| 10-Year DCF (EBITDA) | 905.34 | 241.6% |
Is CML Microsystems Plc (CML.L) a buy or a sell? CML Microsystems Plc is definitely a buy. Based on our DCF analysis, CML Microsystems Plc (CML.L) appears to be slightly undervalued with upside potential of 10.0%. 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:
Investors should consider a hold with potential to accumulate at the current market price of $265.00.