What is CSGN.SW's Intrinsic value?

Credit Suisse Group AG (CSGN.SW) Intrinsic Value Analysis

Executive Summary

As of May 24, 2025, Credit Suisse Group AG's estimated intrinsic value ranges from $1.92 to $1.92 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Stable) $1.92 +134.8%

Is Credit Suisse Group AG (CSGN.SW) undervalued or overvalued?

With the current market price at $0.82, 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 Credit Suisse Group AG's intrinsic value, including:

  1. Dividend Discount Model (DDM): Values the company based on expected future dividend payments

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 1.0% 1.5%
Equity market risk premium 5.1% 6.1%
Adjusted beta 8.46 15.8
Cost of equity 44.1% 98.4%
Cost of debt 5.0% 5.0%
Tax rate 16.8% 18.0%
Debt/Equity ratio 59.82 59.82
After-tax WACC 4.8% 5.6%

Valuation Methods

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: 5.2%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 71.3%
  • Long-term growth rate: 0.5%
  • Fair value: $-0.70 (-185.1% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 98.4% (Low) to 44.1% (High)
  • Long-term growth rate: 0.0% (Low) to 1.0% (High)
  • Fair value range: $1 to $3
  • Selected fair value: $1.92 (134.8% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $3225M
Enterprise Value $280368M
Trailing P/E 0.60
Forward P/E 0.60
Trailing EV/EBITDA 0.00
Current Dividend Yield 868.33%
Dividend Growth Rate (5Y) -19.48%
Debt-to-Equity Ratio 59.82

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
Dividend Discount Model (Stable) 100% $0.29
Weighted Average 100% $1.92

Investment Conclusion

Based on our comprehensive valuation analysis, Credit Suisse Group AG's weighted average intrinsic value is $1.92, which is approximately 134.8% above the current market price of $0.82.

Key investment considerations:

  • Overall financial health and market position

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