As of June 21, 2025, Crown Crafts Inc's estimated intrinsic value ranges from $4.40 to $10.17 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $6.19 | +100.4% |
| Discounted Cash Flow (5Y) | $5.94 | +92.2% |
| Dividend Discount Model (Multi-Stage) | $8.71 | +181.7% |
| Dividend Discount Model (Stable) | $4.40 | +42.3% |
| Earnings Power Value | $10.17 | +229.1% |
Is Crown Crafts Inc (CRWS) undervalued or overvalued?
With the current market price at $3.09, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Crown Crafts Inc'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 | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.48 | 0.79 |
| Cost of equity | 6.1% | 9.3% |
| Cost of debt | 5.1% | 5.1% |
| Tax rate | 20.3% | 21.0% |
| Debt/Equity ratio | 0.26 | 0.26 |
| After-tax WACC | 5.7% | 8.2% |
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 | $6 | $82M | 85.7% |
| 10-Year Growth | $6 | $84M | 66.7% |
| 5-Year EBITDA | $3 | $47M | 75.2% |
| 10-Year EBITDA | $4 | $60M | 53.2% |
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 | $8M |
| Discount Rate (WACC) | 8.2% - 5.7% |
| Enterprise Value | $103M - $148M |
| Net Debt | $20M |
| Equity Value | $83M - $128M |
| Outstanding Shares | 10M |
| Fair Value | $8 - $12 |
| Selected Fair Value | $10.17 |
| Metric | Value |
|---|---|
| Market Capitalization | $32M |
| Enterprise Value | $52M |
| Trailing P/E | 13.18 |
| Forward P/E | 6.62 |
| Trailing EV/EBITDA | 5.20 |
| Current Dividend Yield | 1066.87% |
| Dividend Growth Rate (5Y) | -13.50% |
| Debt-to-Equity Ratio | 0.26 |
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% | $1.86 |
| Discounted Cash Flow (5Y) | 25% | $1.49 |
| Dividend Discount Model (Multi-Stage) | 20% | $1.74 |
| Dividend Discount Model (Stable) | 15% | $0.66 |
| Earnings Power Value | 10% | $1.02 |
| Weighted Average | 100% | $6.76 |
Based on our comprehensive valuation analysis, Crown Crafts Inc's weighted average intrinsic value is $6.76, which is approximately 118.8% above the current market price of $3.09.
Key investment considerations:
Given these factors, we believe Crown Crafts Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.