What is CVX.V's Intrinsic value?

CEMATRIX Corp (CVX.V) Intrinsic Value Analysis

Executive Summary

As of June 18, 2025, CEMATRIX Corp's estimated intrinsic value ranges from $0.25 to $0.68 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $0.68 +119.0%
Discounted Cash Flow (5Y) $0.44 +43.1%
Dividend Discount Model (Multi-Stage) $0.35 +14.2%
Dividend Discount Model (Stable) $0.25 -20.4%

Is CEMATRIX Corp (CVX.V) undervalued or overvalued?

With the current market price at $0.31, 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 CEMATRIX Corp's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. 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 3.9% 4.4%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.89 1.23
Cost of equity 8.4% 12.4%
Cost of debt 4.8% 7.4%
Tax rate 16.2% 19.4%
Debt/Equity ratio 0.07 0.07
After-tax WACC 8.1% 12.0%

Valuation Methods

1. Discounted Cash Flow (DCF) Valuation

Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:

  • Forecast Period: 5-year DCF and 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 10.0% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $53 (FY12-2023) to $140 (FY12-2033)
  • Net profit margin expansion from 2% to 9%
  • Capital expenditures maintained at approximately 3% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $0 $63M 74.0%
10-Year Growth $1 $98M 56.9%
5-Year EBITDA $1 $74M 78.0%
10-Year EBITDA $1 $102M 58.4%

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: 0.0%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 10.4%
  • Long-term growth rate: 2.0%
  • Fair value: $0.35 (14.2% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 12.4% (Low) to 8.4% (High)
  • Long-term growth rate: 1.0% (Low) to 3.0% (High)
  • Fair value range: $0 to $0
  • Selected fair value: $0.25 (-20.4% from current price)

Key Financial Metrics

Metric Value
Market Capitalization $47M
Enterprise Value $43M
Trailing P/E 14.34
Forward P/E 21.90
Trailing EV/EBITDA 7.85
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.07

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
Discounted Cash Flow (10Y) 33% $0.20
Discounted Cash Flow (5Y) 28% $0.11
Dividend Discount Model (Multi-Stage) 22% $0.07
Dividend Discount Model (Stable) 17% $0.04
Weighted Average 100% $0.47

Investment Conclusion

Based on our comprehensive valuation analysis, CEMATRIX Corp's weighted average intrinsic value is $0.47, which is approximately 51.4% above the current market price of $0.31.

Key investment considerations:

  • Strong projected earnings growth (2% to 9% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.07)

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