As of May 22, 2025, Laureate Education Inc has a Discounted Cash Flow (DCF) derived fair value of $32.33 per share. With the current market price at $21.86, this represents a potential upside of 47.9%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $28.24 |
| DCF Fair Value (10-year) | $32.33 |
| Potential Upside (5-year) | 29.2% |
| Potential Upside (10-year) | 47.9% |
| Discount Rate (WACC) | 7.6% - 10.0% |
Revenue is projected to grow from $1567 million in 12-2024 to $2656 million by 12-2034, representing a compound annual growth rate of approximately 5.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 1567 | 6% |
| 12-2025 | 1605 | 2% |
| 12-2026 | 1719 | 7% |
| 12-2027 | 1852 | 8% |
| 12-2028 | 1901 | 3% |
| 12-2029 | 2023 | 6% |
| 12-2030 | 2110 | 4% |
| 12-2031 | 2216 | 5% |
| 12-2032 | 2354 | 6% |
| 12-2033 | 2571 | 9% |
| 12-2034 | 2656 | 3% |
Net profit margin is expected to improve from 19% in 12-2024 to 19% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | 296 | 19% |
| 12-2025 | 310 | 19% |
| 12-2026 | 332 | 19% |
| 12-2027 | 358 | 19% |
| 12-2028 | 367 | 19% |
| 12-2029 | 391 | 19% |
| 12-2030 | 408 | 19% |
| 12-2031 | 428 | 19% |
| 12-2032 | 455 | 19% |
| 12-2033 | 497 | 19% |
| 12-2034 | 513 | 19% |
with a 5-year average of $61 million. Projected CapEx is expected to maintain at approximately 5% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 62 |
| 12-2026 | 69 |
| 12-2027 | 77 |
| 12-2028 | 84 |
| 12-2029 | 89 |
| 12-2030 | 94 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 21 |
| Days Inventory | 0 |
| Days Payables | 17 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2025 | 334 | 86 | 59 | (5) | 193 |
| 2026 | 479 | 123 | 84 | 7 | 265 |
| 2027 | 518 | 132 | 91 | 4 | 291 |
| 2028 | 537 | 136 | 93 | (0) | 308 |
| 2029 | 572 | 145 | 99 | 5 | 324 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 28.24 | 29.2% |
| 10-Year DCF (Growth) | 32.33 | 47.9% |
| 5-Year DCF (EBITDA) | 30.08 | 37.6% |
| 10-Year DCF (EBITDA) | 33.92 | 55.2% |
Is Laureate Education Inc (LAUR) a buy or a sell? Laureate Education Inc is definitely a buy. Based on our DCF analysis, Laureate Education Inc (LAUR) appears to be significantly undervalued with upside potential of 47.9%. 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 strong buy at the current market price of $21.86.