What is MIGO.L's Intrinsic value?

Miton Global Opportunities PLC (MIGO.L) Intrinsic Value Analysis

Executive Summary

As of May 22, 2025, Miton Global Opportunities PLC's estimated intrinsic value ranges from $125.03 to $906.31 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Stable) $906.31 +168.5%
Earnings Power Value $125.03 -63.0%

Is Miton Global Opportunities PLC (MIGO.L) undervalued or overvalued?

With the current market price at $337.50, 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 Miton Global Opportunities PLC's intrinsic value, including:

  1. Dividend Discount Model (DDM): Values the company based on expected future dividend payments
  2. 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 0.72 0.85
Cost of equity 8.3% 10.9%
Cost of debt 4.6% 4.6%
Tax rate 19.0% 19.0%
Debt/Equity ratio 0.08 0.08
After-tax WACC 8.0% 10.4%

Valuation Methods

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: 1.4%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 9.6%
  • Long-term growth rate: 4.0%
  • Fair value: $-372.10 (-210.3% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 10.9% (Low) to 8.3% (High)
  • Long-term growth rate: 3.0% (Low) to 5.0% (High)
  • Fair value range: $443 to $1,369
  • Selected fair value: $906.31 (168.5% 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) 10.4% - 8.0%
Enterprise Value $17M - $22M
Net Debt $(4)M
Equity Value $21M - $26M
Outstanding Shares 0M
Fair Value $111 - $139
Selected Fair Value $125.03

Key Financial Metrics

Metric Value
Market Capitalization $63M
Enterprise Value $60M
Trailing P/E 6.70
Forward P/E 6.70
Trailing EV/EBITDA 9.25
Current Dividend Yield 20.22%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.08

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
Dividend Discount Model (Stable) 60% $135.95
Earnings Power Value 40% $12.50
Weighted Average 100% $593.80

Investment Conclusion

Based on our comprehensive valuation analysis, Miton Global Opportunities PLC's weighted average intrinsic value is $593.80, which is approximately 75.9% above the current market price of $337.50.

Key investment considerations:

  • Strong projected earnings growth (83% to -727% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.08)

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