As of May 23, 2025, Devro PLC has a Discounted Cash Flow (DCF) derived fair value of $278.65 per share. With the current market price at $329.00, this represents a potential upside of -15.3%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $270.83 |
| DCF Fair Value (10-year) | $278.65 |
| Potential Upside (5-year) | -17.7% |
| Potential Upside (10-year) | -15.3% |
| Discount Rate (WACC) | 6.6% - 8.5% |
Revenue is projected to grow from $252 million in 12-2021 to $317 million by 12-2031, representing a compound annual growth rate of approximately 2.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2021 | 252 | 2% |
| 12-2022 | 257 | 2% |
| 12-2023 | 263 | 2% |
| 12-2024 | 268 | 2% |
| 12-2025 | 274 | 2% |
| 12-2026 | 283 | 3% |
| 12-2027 | 292 | 3% |
| 12-2028 | 298 | 2% |
| 12-2029 | 305 | 2% |
| 12-2030 | 311 | 2% |
| 12-2031 | 317 | 2% |
Net profit margin is expected to improve from 12% in 12-2021 to 11% by 12-2031, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2021 | 31 | 12% |
| 12-2022 | 28 | 11% |
| 12-2023 | 28 | 11% |
| 12-2024 | 29 | 11% |
| 12-2025 | 29 | 11% |
| 12-2026 | 30 | 11% |
| 12-2027 | 31 | 11% |
| 12-2028 | 32 | 11% |
| 12-2029 | 33 | 11% |
| 12-2030 | 33 | 11% |
| 12-2031 | 34 | 11% |
with a 5-year average of $14 million. Projected CapEx is expected to maintain at approximately 5% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2022 | 14 |
| 12-2023 | 14 |
| 12-2024 | 15 |
| 12-2025 | 15 |
| 12-2026 | 15 |
| 12-2027 | 15 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 38 |
| Days Inventory | 85 |
| Days Payables | 31 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2022 | 28 | 5 | 7 | 1 | 15 |
| 2023 | 58 | 11 | 14 | 1 | 32 |
| 2024 | 59 | 11 | 15 | 1 | 33 |
| 2025 | 60 | 11 | 15 | 1 | 33 |
| 2026 | 62 | 12 | 15 | 2 | 33 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 270.83 | -17.7% |
| 10-Year DCF (Growth) | 278.65 | -15.3% |
| 5-Year DCF (EBITDA) | 189.23 | -42.5% |
| 10-Year DCF (EBITDA) | 214.69 | -34.7% |
Is Devro PLC (DVO.L) a buy or a sell? Devro PLC is definitely a sell. Based on our DCF analysis, Devro PLC (DVO.L) appears to be overvalued with upside potential of -15.3%. 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 reducing exposure at the current market price of $329.00.