What is DSNO.ST's Intrinsic value?

Desenio Group AB (publ) (DSNO.ST) Intrinsic Value Analysis

Executive Summary

As of June 13, 2025, Desenio Group AB (publ)'s estimated intrinsic value ranges from $0.59 to $2.17 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $2.17 +1563.7%
Discounted Cash Flow (5Y) $1.82 +1293.6%
Earnings Power Value $0.59 +350.7%

Is Desenio Group AB (publ) (DSNO.ST) undervalued or overvalued?

With the current market price at $0.13, 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 Desenio Group AB (publ)'s intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. Earnings Power Value (EPV): Values the company based on its current earnings power, assuming no growth

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 2.5% 3.0%
Equity market risk premium 5.1% 6.1%
Adjusted beta 2.26 3.89
Cost of equity 14.0% 27.3%
Cost of debt 5.0% 5.0%
Tax rate 23.9% 36.6%
Debt/Equity ratio 8.71 8.71
After-tax WACC 4.9% 5.7%

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: 5.3% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $856 (FY12-2024) to $1,314 (FY12-2034)
  • Net profit margin expansion from -3% to -1%
  • Capital expenditures maintained at approximately 2% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $2 $2,786M 79.9%
10-Year Growth $2 $3,132M 65.1%
5-Year EBITDA $1 $2,270M 75.4%
10-Year EBITDA $2 $2,642M 58.6%

3. Earnings Power Value (EPV)

EPV assesses a company's value based on its current normalized earnings power, assuming no growth.

EPV Component Value
Normalized Earnings $82M
Discount Rate (WACC) 5.7% - 4.9%
Enterprise Value $1,459M - $1,697M
Net Debt $1,001M
Equity Value $459M - $696M
Outstanding Shares 982M
Fair Value $0 - $1
Selected Fair Value $0.59

Key Financial Metrics

Metric Value
Market Capitalization $128M
Enterprise Value $1129M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 14.45
Current Dividend Yield 45316.50%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 8.71

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) 46% $0.65
Discounted Cash Flow (5Y) 38% $0.45
Earnings Power Value 15% $0.06
Weighted Average 100% $1.79

Investment Conclusion

Based on our comprehensive valuation analysis, Desenio Group AB (publ)'s weighted average intrinsic value is $1.79, which is approximately 1273.2% above the current market price of $0.13.

Key investment considerations:

  • Strong projected earnings growth (-3% to -1% margin)
  • Consistent cash flow generation

Given these factors, we believe Desenio Group AB (publ) is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.