As of May 31, 2025, Finsbury Growth & Income Trust PLC's estimated intrinsic value ranges from $398.28 to $1163.19 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $1163.19 | +28.1% |
| Discounted Cash Flow (5Y) | $1135.30 | +25.0% |
| Dividend Discount Model (Multi-Stage) | $882.09 | -2.9% |
| Dividend Discount Model (Stable) | $1024.83 | +12.9% |
| Earnings Power Value | $398.28 | -56.1% |
Is Finsbury Growth & Income Trust PLC (FGT.L) undervalued or overvalued?
With the current market price at $908.00, the stock appears to be moderately 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 Finsbury Growth & Income 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 | 0.6 | 0.8 |
| Cost of equity | 7.6% | 10.6% |
| Cost of debt | 4.0% | 4.6% |
| Tax rate | 0.5% | 0.7% |
| Debt/Equity ratio | 0.02 | 0.02 |
| After-tax WACC | 7.5% | 10.4% |
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 | $1,135 | $1,637M | 70.5% |
| 10-Year Growth | $1,163 | $1,677M | 50.4% |
| 5-Year EBITDA | $1,144 | $1,650M | 70.8% |
| 10-Year EBITDA | $1,172 | $1,689M | 50.7% |
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 | $51M |
| Discount Rate (WACC) | 10.4% - 7.5% |
| Enterprise Value | $488M - $680M |
| Net Debt | $15M |
| Equity Value | $473M - $665M |
| Outstanding Shares | 1M |
| Fair Value | $331 - $465 |
| Selected Fair Value | $398.28 |
| Metric | Value |
|---|---|
| Market Capitalization | $1297M |
| Enterprise Value | $1312M |
| Trailing P/E | 11.99 |
| Forward P/E | 11.46 |
| Trailing EV/EBITDA | 14.80 |
| Current Dividend Yield | 290.44% |
| Dividend Growth Rate (5Y) | 2.61% |
| Debt-to-Equity Ratio | 0.02 |
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% | $348.96 |
| Discounted Cash Flow (5Y) | 25% | $283.83 |
| Dividend Discount Model (Multi-Stage) | 20% | $176.42 |
| Dividend Discount Model (Stable) | 15% | $153.72 |
| Earnings Power Value | 10% | $39.83 |
| Weighted Average | 100% | $1002.75 |
Based on our comprehensive valuation analysis, Finsbury Growth & Income Trust PLC's weighted average intrinsic value is $1002.75, which is approximately 10.4% above the current market price of $908.00.
Key investment considerations:
Given these factors, we believe Finsbury Growth & Income Trust PLC is currently moderately undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.