As of December 15, 2025, Hardwoods Distribution Inc has a Discounted Cash Flow (DCF) derived fair value of $49.19 per share. With the current market price at $29.57, this represents a potential upside of 66.3%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $50.15 |
| DCF Fair Value (10-year) | $49.19 |
| Potential Upside (5-year) | 69.6% |
| Potential Upside (10-year) | 66.3% |
| Discount Rate (WACC) | 7.1% - 9.2% |
Revenue is projected to grow from $2580 million in 12-2022 to $2470 million by 12-2032, representing a compound annual growth rate of approximately -0.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2022 | 2580 | 60% |
| 12-2023 | 1988 | -23% |
| 12-2024 | 2028 | 2% |
| 12-2025 | 2068 | 2% |
| 12-2026 | 2141 | 4% |
| 12-2027 | 2186 | 2% |
| 12-2028 | 2230 | 2% |
| 12-2029 | 2312 | 4% |
| 12-2030 | 2365 | 2% |
| 12-2031 | 2412 | 2% |
| 12-2032 | 2470 | 2% |
Net profit margin is expected to improve from 5% in 12-2022 to 5% by 12-2032, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2022 | 129 | 5% |
| 12-2023 | 94 | 5% |
| 12-2024 | 96 | 5% |
| 12-2025 | 98 | 5% |
| 12-2026 | 101 | 5% |
| 12-2027 | 103 | 5% |
| 12-2028 | 105 | 5% |
| 12-2029 | 109 | 5% |
| 12-2030 | 112 | 5% |
| 12-2031 | 114 | 5% |
| 12-2032 | 117 | 5% |
with a 5-year average of $5 million. Projected CapEx is expected to maintain at approximately 0% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2023 | 6 |
| 12-2024 | 7 |
| 12-2025 | 8 |
| 12-2026 | 8 |
| 12-2027 | 8 |
| 12-2028 | 8 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 32 |
| Days Inventory | 103 |
| Days Payables | 0 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2023 | 158 | 31 | 7 | (47) | 166 |
| 2024 | 162 | 32 | 7 | 33 | 89 |
| 2025 | 166 | 33 | 8 | (38) | 163 |
| 2026 | 171 | 34 | 8 | 49 | 81 |
| 2027 | 174 | 35 | 8 | 13 | 119 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 50.15 | 69.6% |
| 10-Year DCF (Growth) | 49.19 | 66.3% |
| 5-Year DCF (EBITDA) | 23.63 | -20.1% |
| 10-Year DCF (EBITDA) | 31.17 | 5.4% |
Is Hardwoods Distribution Inc (HDI.TO) a buy or a sell? Hardwoods Distribution Inc is definitely a buy. Based on our DCF analysis, Hardwoods Distribution Inc (HDI.TO) appears to be significantly undervalued with upside potential of 66.3%.
Investors should consider a strong buy at the current market price of $29.57.