As of May 22, 2025, GP Strategies Corp has a Discounted Cash Flow (DCF) derived fair value of $34.35 per share. With the current market price at $20.85, this represents a potential upside of 64.7%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $26.47 |
| DCF Fair Value (10-year) | $34.35 |
| Potential Upside (5-year) | 26.9% |
| Potential Upside (10-year) | 64.7% |
| Discount Rate (WACC) | 7.3% - 10.6% |
Revenue is projected to grow from $473 million in 12-2020 to $754 million by 12-2030, representing a compound annual growth rate of approximately 4.8%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2020 | 473 | 19% |
| 12-2021 | 501 | 6% |
| 12-2022 | 534 | 7% |
| 12-2023 | 574 | 8% |
| 12-2024 | 592 | 3% |
| 12-2025 | 605 | 2% |
| 12-2026 | 643 | 6% |
| 12-2027 | 691 | 7% |
| 12-2028 | 722 | 4% |
| 12-2029 | 736 | 2% |
| 12-2030 | 754 | 2% |
Net profit margin is expected to improve from 2% in 12-2020 to 7% by 12-2030, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2020 | 7 | 2% |
| 12-2021 | 12 | 2% |
| 12-2022 | 19 | 3% |
| 12-2023 | 26 | 5% |
| 12-2024 | 33 | 6% |
| 12-2025 | 40 | 7% |
| 12-2026 | 43 | 7% |
| 12-2027 | 46 | 7% |
| 12-2028 | 48 | 7% |
| 12-2029 | 49 | 7% |
| 12-2030 | 50 | 7% |
with a 5-year average of $4 million. Projected CapEx is expected to maintain at approximately 1% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2021 | 4 |
| 12-2022 | 4 |
| 12-2023 | 4 |
| 12-2024 | 4 |
| 12-2025 | 4 |
| 12-2026 | 4 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 89 |
| Days Inventory | 0 |
| Days Payables | 33 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2021 | 12 | 3 | 2 | (7) | 15 |
| 2022 | 35 | 9 | 4 | 13 | 9 |
| 2023 | 46 | 12 | 4 | 11 | 18 |
| 2024 | 56 | 16 | 4 | (0) | 37 |
| 2025 | 68 | 19 | 5 | 5 | 39 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 26.47 | 26.9% |
| 10-Year DCF (Growth) | 34.35 | 64.7% |
| 5-Year DCF (EBITDA) | 21.38 | 2.5% |
| 10-Year DCF (EBITDA) | 27.65 | 32.6% |
Is GP Strategies Corp (GPX) a buy or a sell? GP Strategies Corp is definitely a buy. Based on our DCF analysis, GP Strategies Corp (GPX) appears to be significantly undervalued with upside potential of 64.7%. 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 strong buy at the current market price of $20.85.