What is ING.L's Intrinsic value?

Ingenta PLC (ING.L) Intrinsic Value Analysis

Executive Summary

As of May 22, 2025, Ingenta PLC's estimated intrinsic value ranges from $71.77 to $212.41 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $212.41 +199.2%
Discounted Cash Flow (5Y) $197.07 +177.6%
Dividend Discount Model (Multi-Stage) $90.57 +27.6%
Dividend Discount Model (Stable) $71.77 +1.1%
Earnings Power Value $162.43 +128.8%

Is Ingenta PLC (ING.L) undervalued or overvalued?

With the current market price at $71.00, the stock appears to be significantly undervalued.

Understanding Intrinsic Value

Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Ingenta PLC's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. Dividend Discount Model (DDM): Values the company based on expected future dividend payments
  3. Earnings Power Value (EPV): Values the company based on its current earnings power, assuming no growth

Weighted Average Cost of Capital (WACC)

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 1.08 1.32
Cost of equity 10.5% 14.2%
Cost of debt 4.3% 4.6%
Tax rate 10.5% 14.8%
Debt/Equity ratio 1 1
After-tax WACC 7.1% 9.1%

Valuation Methods

1. Discounted Cash Flow (DCF) Valuation

Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:

  • Forecast Period: 5-year DCF and 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 8.1% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $11 (FY12-2023) to $14 (FY12-2033)
  • Net profit margin expansion from 21% to 16%
  • Capital expenditures maintained at approximately 1% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $197 $24M 71.4%
10-Year Growth $212 $26M 50.8%
5-Year EBITDA $120 $14M 49.2%
10-Year EBITDA $153 $18M 28.7%

2. Dividend Discount Model (DDM)

The DDM values a company based on its expected future dividend payments. We used two approaches:

Multi-Stage DDM:

  • Current payout ratio: 39.5%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 12.3%
  • Long-term growth rate: 0.5%
  • Fair value: $90.57 (27.6% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 14.2% (Low) to 10.5% (High)
  • Long-term growth rate: 0.0% (Low) to 1.0% (High)
  • Fair value range: $49 to $95
  • Selected fair value: $71.77 (1.1% from current price)

3. Earnings Power Value (EPV)

EPV assesses a company's value based on its current normalized earnings power, assuming no growth.

EPV Component Value
Normalized Earnings $2M
Discount Rate (WACC) 9.1% - 7.1%
Enterprise Value $17M - $22M
Net Debt $(3)M
Equity Value $20M - $25M
Outstanding Shares 0M
Fair Value $146 - $179
Selected Fair Value $162.43

Key Financial Metrics

Metric Value
Market Capitalization $10M
Enterprise Value $7M
Trailing P/E 7.14
Forward P/E 5.76
Trailing EV/EBITDA 4.10
Current Dividend Yield 569.09%
Dividend Growth Rate (5Y) 21.03%
Debt-to-Equity Ratio 0.84

Investment Decision Framework

To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:

  1. Forecast Certainty: DCF methods rely on long-term projections, while earnings power value focuses on current normalized earnings
  2. Business Model Alignment: Dividend models are more appropriate for mature companies with established dividend policies
  3. Historical Accuracy: How well each method has predicted fair value historically

Valuation Weight Matrix

Valuation Method Weight Weighted Value
Discounted Cash Flow (10Y) 30% $63.72
Discounted Cash Flow (5Y) 25% $49.27
Dividend Discount Model (Multi-Stage) 20% $18.11
Dividend Discount Model (Stable) 15% $10.77
Earnings Power Value 10% $16.24
Weighted Average 100% $158.11

Investment Conclusion

Based on our comprehensive valuation analysis, Ingenta PLC's weighted average intrinsic value is $158.11, which is approximately 122.7% above the current market price of $71.00.

Key investment considerations:

  • Strong projected earnings growth (21% to 16% margin)
  • Consistent cash flow generation
  • Historical dividend growth of 21.03%

Given these factors, we believe Ingenta PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.