As of May 22, 2025, Croda International PLC's estimated intrinsic value ranges from $1557.70 to $4346.97 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $1835.05 | -41.1% |
| Discounted Cash Flow (5Y) | $1683.95 | -46.0% |
| Dividend Discount Model (Multi-Stage) | $1669.21 | -46.5% |
| Dividend Discount Model (Stable) | $1557.70 | -50.0% |
| Earnings Power Value | $4346.97 | +39.4% |
Is Croda International PLC (CRDA.L) undervalued or overvalued?
With the current market price at $3118.00, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Croda International 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 | 0.76 | 0.83 |
| Cost of equity | 8.5% | 10.8% |
| Cost of debt | 4.0% | 4.9% |
| Tax rate | 22.5% | 24.0% |
| Debt/Equity ratio | 0.16 | 0.16 |
| After-tax WACC | 7.8% | 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 | $1,684 | $2,911M | 74.5% |
| 10-Year Growth | $1,835 | $3,124M | 57.1% |
| 5-Year EBITDA | $1,986 | $3,338M | 77.8% |
| 10-Year EBITDA | $1,976 | $3,323M | 59.7% |
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 | $580M |
| Discount Rate (WACC) | 9.8% - 7.8% |
| Enterprise Value | $5,909M - $7,436M |
| Net Debt | $532M |
| Equity Value | $5,376M - $6,904M |
| Outstanding Shares | 1M |
| Fair Value | $3,806 - $4,888 |
| Selected Fair Value | $4346.97 |
| Metric | Value |
|---|---|
| Market Capitalization | $4404M |
| Enterprise Value | $4937M |
| Trailing P/E | 27.79 |
| Forward P/E | 26.15 |
| Trailing EV/EBITDA | 8.60 |
| Current Dividend Yield | 346.36% |
| Dividend Growth Rate (5Y) | 7.05% |
| Debt-to-Equity Ratio | 0.16 |
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% | $550.51 |
| Discounted Cash Flow (5Y) | 25% | $420.99 |
| Dividend Discount Model (Multi-Stage) | 20% | $333.84 |
| Dividend Discount Model (Stable) | 15% | $233.66 |
| Earnings Power Value | 10% | $434.70 |
| Weighted Average | 100% | $1973.70 |
Based on our comprehensive valuation analysis, Croda International PLC's weighted average intrinsic value is $1973.70, which is approximately 36.7% below the current market price of $3118.00.
Key investment considerations:
Given these factors, we believe Croda International PLC is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.