As of June 22, 2025, Doman Building Materials Group Ltd's estimated intrinsic value ranges from $8.00 to $99.57 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $99.57 | +1055.1% |
| Discounted Cash Flow (5Y) | $63.49 | +636.6% |
| Dividend Discount Model (Multi-Stage) | $31.06 | +260.4% |
| Dividend Discount Model (Stable) | $8.00 | -7.1% |
| Earnings Power Value | $20.01 | +132.1% |
Is Doman Building Materials Group Ltd (DBM.TO) undervalued or overvalued?
With the current market price at $8.62, 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 Doman Building Materials Group Ltd'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 | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 1.28 | 1.49 |
| Cost of equity | 9.7% | 13.2% |
| Cost of debt | 4.8% | 6.3% |
| Tax rate | 17.5% | 21.4% |
| Debt/Equity ratio | 1.52 | 1.52 |
| After-tax WACC | 6.2% | 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 | $63 | $6,817M | 84.5% |
| 10-Year Growth | $100 | $9,972M | 72.8% |
| 5-Year EBITDA | $27 | $3,640M | 71.0% |
| 10-Year EBITDA | $51 | $5,694M | 52.4% |
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 | $214M |
| Discount Rate (WACC) | 8.2% - 6.2% |
| Enterprise Value | $2,591M - $3,440M |
| Net Debt | $1,266M |
| Equity Value | $1,325M - $2,174M |
| Outstanding Shares | 87M |
| Fair Value | $15 - $25 |
| Selected Fair Value | $20.01 |
| Metric | Value |
|---|---|
| Market Capitalization | $754M |
| Enterprise Value | $2019M |
| Trailing P/E | 11.89 |
| Forward P/E | 7.36 |
| Trailing EV/EBITDA | 7.25 |
| Current Dividend Yield | 648.01% |
| Dividend Growth Rate (5Y) | 3.83% |
| Debt-to-Equity Ratio | 1.52 |
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% | $29.87 |
| Discounted Cash Flow (5Y) | 25% | $15.87 |
| Dividend Discount Model (Multi-Stage) | 20% | $6.21 |
| Dividend Discount Model (Stable) | 15% | $1.20 |
| Earnings Power Value | 10% | $2.00 |
| Weighted Average | 100% | $55.16 |
Based on our comprehensive valuation analysis, Doman Building Materials Group Ltd's weighted average intrinsic value is $55.16, which is approximately 539.9% above the current market price of $8.62.
Key investment considerations:
Given these factors, we believe Doman Building Materials Group Ltd is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.