As of May 27, 2025, Image Systems AB has a Discounted Cash Flow (DCF) derived fair value of $2.25 per share. With the current market price at $1.98, this represents a potential upside of 13.8%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $2.43 |
| DCF Fair Value (10-year) | $2.25 |
| Potential Upside (5-year) | 22.8% |
| Potential Upside (10-year) | 13.8% |
| Discount Rate (WACC) | 4.7% - 6.7% |
Revenue is projected to grow from $200 million in 12-2024 to $277 million by 12-2034, representing a compound annual growth rate of approximately 3.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 200 | 17% |
| 12-2025 | 207 | 3% |
| 12-2026 | 222 | 7% |
| 12-2027 | 226 | 2% |
| 12-2028 | 231 | 2% |
| 12-2029 | 242 | 5% |
| 12-2030 | 252 | 4% |
| 12-2031 | 259 | 3% |
| 12-2032 | 264 | 2% |
| 12-2033 | 269 | 2% |
| 12-2034 | 277 | 3% |
Net profit margin is expected to improve from 4% in 12-2024 to 4% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 9 | 4% |
| 12-2025 | 8 | 4% |
| 12-2026 | 8 | 4% |
| 12-2027 | 8 | 4% |
| 12-2028 | 8 | 4% |
| 12-2029 | 9 | 4% |
| 12-2030 | 9 | 4% |
| 12-2031 | 10 | 4% |
| 12-2032 | 10 | 4% |
| 12-2033 | 10 | 4% |
| 12-2034 | 10 | 4% |
with a 5-year average of $12 million. Projected CapEx is expected to maintain at approximately 7% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 14 |
| 12-2026 | 15 |
| 12-2027 | 16 |
| 12-2028 | 17 |
| 12-2029 | 15 |
| 12-2030 | 16 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 66 |
| Days Inventory | 88 |
| Days Payables | 89 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2025 | 23 | 1 | 14 | (8) | 16 |
| 2026 | 25 | 1 | 15 | 7 | 2 |
| 2027 | 26 | 1 | 15 | 1 | 9 |
| 2028 | 27 | 1 | 15 | (1) | 12 |
| 2029 | 26 | 1 | 16 | 3 | 5 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 2.43 | 22.8% |
| 10-Year DCF (Growth) | 2.25 | 13.8% |
| 5-Year DCF (EBITDA) | 2.35 | 18.6% |
| 10-Year DCF (EBITDA) | 2.34 | 18.1% |
Is Image Systems AB (IS.ST) a buy or a sell? Image Systems AB is definitely a buy. Based on our DCF analysis, Image Systems AB (IS.ST) appears to be moderately undervalued with upside potential of 13.8%. 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 buy at the current market price of $1.98.