What is JSW.WA's Intrinsic value?

Jastrzebska Spolka Weglowa SA (JSW.WA) Intrinsic Value Analysis

Executive Summary

As of June 17, 2025, Jastrzebska Spolka Weglowa SA's estimated intrinsic value ranges from $46.43 to $46.43 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Earnings Power Value $46.43 +116.5%

Is Jastrzebska Spolka Weglowa SA (JSW.WA) undervalued or overvalued?

With the current market price at $21.44, 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 Jastrzebska Spolka Weglowa SA's intrinsic value, including:

  1. 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 5.5% 6.0%
Equity market risk premium 6.3% 7.3%
Adjusted beta 0.59 0.78
Cost of equity 9.3% 12.2%
Cost of debt 4.0% 7.0%
Tax rate 18.1% 18.7%
Debt/Equity ratio 0.99 0.99
After-tax WACC 6.3% 9.0%

Valuation Methods

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 $523M
Discount Rate (WACC) 9.0% - 6.3%
Enterprise Value $5,822M - $8,310M
Net Debt $1,615M
Equity Value $4,207M - $6,695M
Outstanding Shares 117M
Fair Value $36 - $57
Selected Fair Value $46.43

Key Financial Metrics

Metric Value
Market Capitalization $2517M
Enterprise Value $4132M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 5.40
Current Dividend Yield 712.59%
Dividend Growth Rate (5Y) -8.14%
Debt-to-Equity Ratio 0.99

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
Earnings Power Value 100% $4.64
Weighted Average 100% $46.43

Investment Conclusion

Based on our comprehensive valuation analysis, Jastrzebska Spolka Weglowa SA's weighted average intrinsic value is $46.43, which is approximately 116.5% above the current market price of $21.44.

Key investment considerations:

  • Strong projected earnings growth (-64% to -37% margin)
  • Consistent cash flow generation

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