What is CONF.ST's Intrinsic value?

Confidence International AB (CONF.ST) Intrinsic Value Analysis

Executive Summary

As of May 22, 2025, Confidence International AB's estimated intrinsic value ranges from $0.27 to $0.27 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Earnings Power Value $0.27 -87.2%

Is Confidence International AB (CONF.ST) undervalued or overvalued?

With the current market price at $2.14, 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 Confidence International AB's intrinsic value, including:

  1. 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 2.3% 2.8%
Equity market risk premium 4.7% 5.7%
Adjusted beta 0.53 0.71
Cost of equity 5.3% 7.9%
Cost of debt 5.9% 7.0%
Tax rate 21.4% 21.6%
Debt/Equity ratio 0.28 0.28
After-tax WACC 5.2% 7.4%

Valuation Methods

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 $3M
Discount Rate (WACC) 7.4% - 5.2%
Enterprise Value $45M - $64M
Net Debt $35M
Equity Value $10M - $29M
Outstanding Shares 69M
Fair Value $0 - $0
Selected Fair Value $0.27

Key Financial Metrics

Metric Value
Market Capitalization $148M
Enterprise Value $183M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 6.30
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.28

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
Earnings Power Value 100% $0.03
Weighted Average 100% $0.27

Investment Conclusion

Based on our comprehensive valuation analysis, Confidence International AB's weighted average intrinsic value is $0.27, which is approximately 87.2% below the current market price of $2.14.

Key investment considerations:

  • Strong projected earnings growth (-16% to -2% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.28)

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