As of June 10, 2025, HgCapital Trust PLC's estimated intrinsic value ranges from $330.10 to $697.07 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $656.29 | +32.0% |
| Discounted Cash Flow (5Y) | $621.99 | +25.1% |
| Dividend Discount Model (Multi-Stage) | $466.09 | -6.2% |
| Dividend Discount Model (Stable) | $697.07 | +40.3% |
| Earnings Power Value | $330.10 | -33.6% |
Is HgCapital Trust PLC (HGT.L) undervalued or overvalued?
With the current market price at $497.00, 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 HgCapital 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 | 0.86 | 0.93 |
| Cost of equity | 9.2% | 11.5% |
| Cost of debt | 5.0% | 5.0% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 0.04 | 0.04 |
| After-tax WACC | 8.9% | 11.2% |
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 | $622 | $2,933M | 73.0% |
| 10-Year Growth | $656 | $3,090M | 53.7% |
| 5-Year EBITDA | $338 | $1,630M | 51.3% |
| 10-Year EBITDA | $435 | $2,075M | 31.0% |
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 | $159M |
| Discount Rate (WACC) | 11.2% - 8.9% |
| Enterprise Value | $1,415M - $1,773M |
| Net Debt | $80M |
| Equity Value | $1,335M - $1,693M |
| Outstanding Shares | 5M |
| Fair Value | $291 - $369 |
| Selected Fair Value | $330.10 |
| Metric | Value |
|---|---|
| Market Capitalization | $2279M |
| Enterprise Value | $2359M |
| Trailing P/E | 9.65 |
| Forward P/E | 11.42 |
| Trailing EV/EBITDA | 4.80 |
| Current Dividend Yield | 130.52% |
| Dividend Growth Rate (5Y) | 9.90% |
| Debt-to-Equity Ratio | 0.04 |
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% | $196.89 |
| Discounted Cash Flow (5Y) | 25% | $155.50 |
| Dividend Discount Model (Multi-Stage) | 20% | $93.22 |
| Dividend Discount Model (Stable) | 15% | $104.56 |
| Earnings Power Value | 10% | $33.01 |
| Weighted Average | 100% | $583.17 |
Based on our comprehensive valuation analysis, HgCapital Trust PLC's weighted average intrinsic value is $583.17, which is approximately 17.3% above the current market price of $497.00.
Key investment considerations:
Given these factors, we believe HgCapital Trust PLC is currently moderately undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.