What is ODD.ST's Intrinsic value?

Odd Molly International AB (ODD.ST) Intrinsic Value Analysis

Executive Summary

As of June 13, 2025, Odd Molly International AB's estimated intrinsic value ranges from $14.10 to $16.27 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Dividend Discount Model (Multi-Stage) $14.10 -51.6%
Dividend Discount Model (Stable) $15.74 -45.9%
Earnings Power Value $16.27 -44.1%

Is Odd Molly International AB (ODD.ST) undervalued or overvalued?

With the current market price at $29.10, the stock appears to be significantly overvalued.

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 Odd Molly International AB'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 0.6% 1.1%
Equity market risk premium 5.2% 6.2%
Adjusted beta 0.61 0.71
Cost of equity 4.3% 6.6%
Cost of debt 7.0% 7.0%
Tax rate 21.1% 27.9%
Debt/Equity ratio 0.01 0.01
After-tax WACC 4.3% 6.6%

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: 0.0%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 5.4%
  • Long-term growth rate: 3.5%
  • Fair value: $14.10 (-51.6% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 6.6% (Low) to 4.3% (High)
  • Long-term growth rate: 3.0% (Low) to 3.9% (High)
  • Fair value range: $2 to $29
  • Selected fair value: $15.74 (-45.9% 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 $59M
Discount Rate (WACC) 6.6% - 4.3%
Enterprise Value $902M - $1,367M
Net Debt $(59)M
Equity Value $961M - $1,426M
Outstanding Shares 73M
Fair Value $13 - $19
Selected Fair Value $16.27

Key Financial Metrics

Metric Value
Market Capitalization $2231M
Enterprise Value $1276M
Trailing P/E 148.82
Forward P/E 80.79
Trailing EV/EBITDA 6.35
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.01

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 (Multi-Stage) 44% $2.82
Dividend Discount Model (Stable) 33% $2.36
Earnings Power Value 22% $1.63
Weighted Average 100% $15.13

Investment Conclusion

Based on our comprehensive valuation analysis, Odd Molly International AB's weighted average intrinsic value is $15.13, which is approximately 48.0% below the current market price of $29.10.

Key investment considerations:

  • Strong projected earnings growth (1% to 14% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.01)

Given these factors, we believe Odd Molly International AB is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.