As of May 29, 2025, Newater Technology Inc's estimated intrinsic value ranges from $0.15 to $42.83 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $42.83 | +927.1% |
| Discounted Cash Flow (5Y) | $0.15 | -96.4% |
| Dividend Discount Model (Multi-Stage) | $21.59 | +417.7% |
| Dividend Discount Model (Stable) | $14.57 | +249.5% |
| Earnings Power Value | $2.07 | -50.3% |
Is Newater Technology Inc (NEWA) undervalued or overvalued?
With the current market price at $4.17, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Newater Technology Inc's intrinsic value, including:
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 | 3.2% | 3.7% |
| Equity market risk premium | 4.2% | 5.2% |
| Adjusted beta | 0.85 | 1.07 |
| Cost of equity | 6.8% | 9.8% |
| Cost of debt | 4.3% | 7.9% |
| Tax rate | 17.3% | 18.6% |
| Debt/Equity ratio | 0.61 | 0.61 |
| After-tax WACC | 5.6% | 8.5% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $0 | $24M | 35.8% |
| 10-Year Growth | $43 | $486M | 78.7% |
| 5-Year EBITDA | $17 | $202M | 92.2% |
| 10-Year EBITDA | $39 | $446M | 76.8% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $3M |
| Discount Rate (WACC) | 8.5% - 5.6% |
| Enterprise Value | $36M - $55M |
| Net Debt | $23M |
| Equity Value | $13M - $32M |
| Outstanding Shares | 11M |
| Fair Value | $1 - $3 |
| Selected Fair Value | $2.07 |
| Metric | Value |
|---|---|
| Market Capitalization | $45M |
| Enterprise Value | $68M |
| Trailing P/E | 4.57 |
| Forward P/E | 7.34 |
| Trailing EV/EBITDA | 6.15 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.61 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $12.85 |
| Discounted Cash Flow (5Y) | 25% | $0.04 |
| Dividend Discount Model (Multi-Stage) | 20% | $4.32 |
| Dividend Discount Model (Stable) | 15% | $2.19 |
| Earnings Power Value | 10% | $0.21 |
| Weighted Average | 100% | $19.60 |
Based on our comprehensive valuation analysis, Newater Technology Inc's weighted average intrinsic value is $19.60, which is approximately 370.0% above the current market price of $4.17.
Key investment considerations:
Given these factors, we believe Newater Technology Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.