What is JANL's Intrinsic value?

Janel Corp (JANL) Intrinsic Value Analysis

Executive Summary

As of December 15, 2025, Janel Corp's estimated intrinsic value ranges from $34.78 to $123.24 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $123.24 +262.5%
Discounted Cash Flow (5Y) $102.22 +200.6%
Dividend Discount Model (Multi-Stage) $34.78 +2.3%
Dividend Discount Model (Stable) $43.27 +27.3%
Earnings Power Value $71.36 +109.9%

Is Janel Corp (JANL) undervalued or overvalued?

With the current market price at $34.00, 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 Janel Corp'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 3.9% 4.4%
Equity market risk premium 4.6% 5.6%
Adjusted beta 0.95 1.19
Cost of equity 8.2% 11.5%
Cost of debt 4.1% 5.1%
Tax rate 29.7% 42.5%
Debt/Equity ratio 0.87 0.87
After-tax WACC 5.8% 7.5%

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: 6.6% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $207 (FY09-2025) to $382 (FY09-2035)
  • Net profit margin expansion from 3% to 2%
  • Capital expenditures maintained at approximately 0% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $102 $131M 86.4%
10-Year Growth $123 $157M 66.6%
5-Year EBITDA $50 $68M 73.8%
10-Year EBITDA $78 $102M 48.6%

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: 17.8%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 9.9%
  • Long-term growth rate: 0.5%
  • Fair value: $34.78 (2.3% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 11.5% (Low) to 8.2% (High)
  • Long-term growth rate: 0.0% (Low) to 1.0% (High)
  • Fair value range: $28 to $58
  • Selected fair value: $43.27 (27.3% 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 $6M
Discount Rate (WACC) 7.5% - 5.8%
Enterprise Value $81M - $106M
Net Debt $8M
Equity Value $74M - $99M
Outstanding Shares 1M
Fair Value $61 - $82
Selected Fair Value $71.36

Key Financial Metrics

Metric Value
Market Capitalization $41M
Enterprise Value $49M
Trailing P/E 7.27
Forward P/E 9.18
Trailing EV/EBITDA 5.75
Current Dividend Yield 245.02%
Dividend Growth Rate (5Y) 68.21%
Debt-to-Equity Ratio 0.45

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% $36.97
Discounted Cash Flow (5Y) 25% $25.55
Dividend Discount Model (Multi-Stage) 20% $6.96
Dividend Discount Model (Stable) 15% $6.49
Earnings Power Value 10% $7.14
Weighted Average 100% $83.11

Investment Conclusion

Based on our comprehensive valuation analysis, Janel Corp's intrinsic value is $83.11, which is approximately 144.4% above the current market price of $34.00.

Key investment considerations:

  • Strong projected earnings growth (3% to 2% margin)
  • Consistent cash flow generation
  • Historical dividend growth of 68.21%

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