As of May 23, 2025, F&C Investment Trust PLC's estimated intrinsic value ranges from $736.19 to $2619.79 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $2619.79 | +142.3% |
| Discounted Cash Flow (5Y) | $2445.91 | +126.3% |
| Dividend Discount Model (Multi-Stage) | $1648.29 | +52.5% |
| Dividend Discount Model (Stable) | $1774.50 | +64.2% |
| Earnings Power Value | $736.19 | -31.9% |
Is F&C Investment Trust PLC (FCIT.L) undervalued or overvalued?
With the current market price at $1081.00, 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 F&C Investment Trust 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 | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 0.97 | 1.02 |
| Cost of equity | 9.8% | 12.1% |
| Cost of debt | 4.0% | 4.6% |
| Tax rate | 1.4% | 1.8% |
| Debt/Equity ratio | 0.12 | 0.12 |
| After-tax WACC | 9.2% | 11.3% |
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 | $2,446 | $11,526M | 62.3% |
| 10-Year Growth | $2,620 | $12,311M | 40.3% |
| 5-Year EBITDA | $1,716 | $8,233M | 47.2% |
| 10-Year EBITDA | $2,115 | $10,034M | 26.8% |
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 | $386M |
| Discount Rate (WACC) | 11.3% - 9.2% |
| Enterprise Value | $3,420M - $4,201M |
| Net Debt | $488M |
| Equity Value | $2,931M - $3,713M |
| Outstanding Shares | 5M |
| Fair Value | $650 - $823 |
| Selected Fair Value | $736.19 |
| Metric | Value |
|---|---|
| Market Capitalization | $4878M |
| Enterprise Value | $5366M |
| Trailing P/E | 4.88 |
| Forward P/E | 4.67 |
| Trailing EV/EBITDA | 5.50 |
| Current Dividend Yield | 150.93% |
| Dividend Growth Rate (5Y) | 4.76% |
| Debt-to-Equity Ratio | 0.12 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $785.94 |
| Discounted Cash Flow (5Y) | 25% | $611.48 |
| Dividend Discount Model (Multi-Stage) | 20% | $329.66 |
| Dividend Discount Model (Stable) | 15% | $266.18 |
| Earnings Power Value | 10% | $73.62 |
| Weighted Average | 100% | $2066.87 |
Based on our comprehensive valuation analysis, F&C Investment Trust PLC's weighted average intrinsic value is $2066.87, which is approximately 91.2% above the current market price of $1081.00.
Key investment considerations:
Given these factors, we believe F&C Investment Trust PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.