As of June 5, 2025, Diversey Holdings Ltd has a Discounted Cash Flow (DCF) derived fair value of $7.64 per share. With the current market price at $8.39, this represents a potential upside of -9.0%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $4.20 |
| DCF Fair Value (10-year) | $7.64 |
| Potential Upside (5-year) | -50.0% |
| Potential Upside (10-year) | -9.0% |
| Discount Rate (WACC) | 6.2% - 14.0% |
Revenue is projected to grow from $2766 million in 12-2022 to $3520 million by 12-2032, representing a compound annual growth rate of approximately 2.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2022 | 2766 | 6% |
| 12-2023 | 2855 | 3% |
| 12-2024 | 2917 | 2% |
| 12-2025 | 2986 | 2% |
| 12-2026 | 3050 | 2% |
| 12-2027 | 3111 | 2% |
| 12-2028 | 3173 | 2% |
| 12-2029 | 3273 | 3% |
| 12-2030 | 3343 | 2% |
| 12-2031 | 3410 | 2% |
| 12-2032 | 3520 | 3% |
Net profit margin is expected to improve from -6% in 12-2022 to 9% by 12-2032, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2022 | (169) | -6% |
| 12-2023 | (78) | -3% |
| 12-2024 | (1) | 0% |
| 12-2025 | 75 | 3% |
| 12-2026 | 151 | 5% |
| 12-2027 | 226 | 7% |
| 12-2028 | 245 | 8% |
| 12-2029 | 267 | 8% |
| 12-2030 | 287 | 9% |
| 12-2031 | 307 | 9% |
| 12-2032 | 332 | 9% |
with a 5-year average of $119 million. Projected CapEx is expected to maintain at approximately 4% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2023 | 118 |
| 12-2024 | 120 |
| 12-2025 | 129 |
| 12-2026 | 132 |
| 12-2027 | 133 |
| 12-2028 | 135 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 55 |
| Days Inventory | 70 |
| Days Payables | 100 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2023 | 94 | (12) | 95 | 16 | (6) |
| 2024 | 221 | (0) | 130 | 33 | 59 |
| 2025 | 325 | 15 | 133 | 2 | 174 |
| 2026 | 422 | 31 | 135 | 16 | 239 |
| 2027 | 514 | 46 | 138 | 17 | 313 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 4.20 | -50.0% |
| 10-Year DCF (Growth) | 7.64 | -9.0% |
| 5-Year DCF (EBITDA) | 7.78 | -7.3% |
| 10-Year DCF (EBITDA) | 10.07 | 20.0% |
Is Diversey Holdings Ltd (DSEY) a buy or a sell? Diversey Holdings Ltd is definitely a sell. Based on our DCF analysis, Diversey Holdings Ltd (DSEY) appears to be fairly valued with upside potential of -9.0%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a hold at the current market price of $8.39.