As of May 29, 2025, Dixons Carphone PLC's estimated intrinsic value ranges from $530.57 to $1816.53 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $1208.57 | +1128.2% |
| Discounted Cash Flow (5Y) | $948.39 | +863.8% |
| Dividend Discount Model (Multi-Stage) | $530.57 | +439.2% |
| Earnings Power Value | $1816.53 | +1746.1% |
Is Dixons Carphone PLC (DC.L) undervalued or overvalued?
With the current market price at $98.40, 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 Dixons Carphone 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 | 2.9% | 3.4% |
| Equity market risk premium | 5.3% | 6.3% |
| Adjusted beta | 0.88 | 1.03 |
| Cost of equity | 7.6% | 10.4% |
| Cost of debt | 6.1% | 7.0% |
| Tax rate | 19.4% | 21.7% |
| Debt/Equity ratio | 1.12 | 1.12 |
| After-tax WACC | 6.2% | 7.8% |
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 | $948 | $12,599M | 83.3% |
| 10-Year Growth | $1,209 | $15,737M | 67.5% |
| 5-Year EBITDA | $372 | $5,643M | 62.6% |
| 10-Year EBITDA | $613 | $8,548M | 40.2% |
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 | $1,597M |
| Discount Rate (WACC) | 7.8% - 6.2% |
| Enterprise Value | $20,417M - $25,727M |
| Net Debt | $1,157M |
| Equity Value | $19,260M - $24,570M |
| Outstanding Shares | 12M |
| Fair Value | $1,596 - $2,037 |
| Selected Fair Value | $1816.53 |
| Metric | Value |
|---|---|
| Market Capitalization | $1187M |
| Enterprise Value | $2344M |
| Trailing P/E | 0.00 |
| Forward P/E | 6.88 |
| Trailing EV/EBITDA | 4.40 |
| Current Dividend Yield | 657.06% |
| Dividend Growth Rate (5Y) | -100.00% |
| Debt-to-Equity Ratio | 1.12 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 35% | $362.57 |
| Discounted Cash Flow (5Y) | 29% | $237.10 |
| Dividend Discount Model (Multi-Stage) | 24% | $106.11 |
| Earnings Power Value | 12% | $181.65 |
| Weighted Average | 100% | $1044.04 |
Based on our comprehensive valuation analysis, Dixons Carphone PLC's weighted average intrinsic value is $1044.04, which is approximately 961.0% above the current market price of $98.40.
Key investment considerations:
Given these factors, we believe Dixons Carphone PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.