As of June 17, 2025, Ernst Russ AG's estimated intrinsic value ranges from $15.57 to $35.05 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $34.44 | +378.4% |
| Discounted Cash Flow (5Y) | $30.67 | +325.9% |
| Dividend Discount Model (Multi-Stage) | $29.54 | +310.3% |
| Dividend Discount Model (Stable) | $15.57 | +116.3% |
| Earnings Power Value | $35.05 | +386.8% |
Is Ernst Russ AG (HXCK.DE) undervalued or overvalued?
With the current market price at $7.20, 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 Ernst Russ AG'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 | 2.8% | 3.3% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.71 | 0.82 |
| Cost of equity | 6.4% | 8.8% |
| Cost of debt | 4.0% | 32.4% |
| Tax rate | 1.2% | 1.9% |
| Debt/Equity ratio | 0.01 | 0.01 |
| After-tax WACC | 6.4% | 8.9% |
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 | $31 | $925M | 70.1% |
| 10-Year Growth | $34 | $1,052M | 52.2% |
| 5-Year EBITDA | $22 | $643M | 57.0% |
| 10-Year EBITDA | $27 | $813M | 38.1% |
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 | $80M |
| Discount Rate (WACC) | 8.9% - 6.4% |
| Enterprise Value | $891M - $1,253M |
| Net Debt | $(109)M |
| Equity Value | $1,000M - $1,362M |
| Outstanding Shares | 34M |
| Fair Value | $30 - $40 |
| Selected Fair Value | $35.05 |
| Metric | Value |
|---|---|
| Market Capitalization | $243M |
| Enterprise Value | $134M |
| Trailing P/E | 5.71 |
| Forward P/E | 3.50 |
| Trailing EV/EBITDA | 4.90 |
| Current Dividend Yield | 1937.33% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.01 |
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% | $10.33 |
| Discounted Cash Flow (5Y) | 25% | $7.67 |
| Dividend Discount Model (Multi-Stage) | 20% | $5.91 |
| Dividend Discount Model (Stable) | 15% | $2.34 |
| Earnings Power Value | 10% | $3.50 |
| Weighted Average | 100% | $29.75 |
Based on our comprehensive valuation analysis, Ernst Russ AG's weighted average intrinsic value is $29.75, which is approximately 313.2% above the current market price of $7.20.
Key investment considerations:
Given these factors, we believe Ernst Russ AG is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.