As of May 24, 2025, Datto Holding Corp has a Discounted Cash Flow (DCF) derived fair value of $31.97 per share. With the current market price at $35.18, this represents a potential upside of -9.1%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $22.64 |
| DCF Fair Value (10-year) | $31.97 |
| Potential Upside (5-year) | -35.6% |
| Potential Upside (10-year) | -9.1% |
| Discount Rate (WACC) | 5.1% - 8.0% |
Revenue is projected to grow from $619 million in 12-2021 to $1674 million by 12-2031, representing a compound annual growth rate of approximately 10.5%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2021 | 619 | 19% |
| 12-2022 | 710 | 15% |
| 12-2023 | 846 | 19% |
| 12-2024 | 938 | 11% |
| 12-2025 | 1030 | 10% |
| 12-2026 | 1135 | 10% |
| 12-2027 | 1212 | 7% |
| 12-2028 | 1316 | 9% |
| 12-2029 | 1407 | 7% |
| 12-2030 | 1545 | 10% |
| 12-2031 | 1674 | 8% |
Net profit margin is expected to improve from 8% in 12-2021 to 14% by 12-2031, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2021 | 51 | 8% |
| 12-2022 | 66 | 9% |
| 12-2023 | 88 | 10% |
| 12-2024 | 107 | 11% |
| 12-2025 | 128 | 12% |
| 12-2026 | 151 | 13% |
| 12-2027 | 164 | 14% |
| 12-2028 | 180 | 14% |
| 12-2029 | 195 | 14% |
| 12-2030 | 217 | 14% |
| 12-2031 | 238 | 14% |
. Projected CapEx is expected to maintain at approximately 8% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2022 | 42 |
| 12-2023 | 49 |
| 12-2024 | 56 |
| 12-2025 | 64 |
| 12-2026 | 72 |
| 12-2027 | 80 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 17 |
| Days Inventory | 45 |
| Days Payables | 25 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2022 | 92 | 11 | 41 | (5) | 44 |
| 2023 | 157 | 20 | 66 | 10 | 62 |
| 2024 | 188 | 24 | 73 | 8 | 83 |
| 2025 | 222 | 29 | 80 | 2 | 110 |
| 2026 | 259 | 34 | 88 | 6 | 130 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 22.64 | -35.6% |
| 10-Year DCF (Growth) | 31.97 | -9.1% |
| 5-Year DCF (EBITDA) | 36.82 | 4.7% |
| 10-Year DCF (EBITDA) | 47.44 | 34.8% |
Is Datto Holding Corp (MSP) a buy or a sell? Datto Holding Corp is definitely a sell. Based on our DCF analysis, Datto Holding Corp (MSP) appears to be fairly valued with upside potential of -9.1%. 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 hold at the current market price of $35.18.