As of June 12, 2025, Optex Systems Holdings Inc's estimated intrinsic value ranges from $5.02 to $11.26 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $11.26 | +12.4% |
| Discounted Cash Flow (5Y) | $8.06 | -19.4% |
| Dividend Discount Model (Multi-Stage) | $9.12 | -8.9% |
| Dividend Discount Model (Stable) | $9.51 | -5.0% |
| Earnings Power Value | $5.02 | -49.8% |
Is Optex Systems Holdings Inc (OPXS) undervalued or overvalued?
With the current market price at $10.01, the stock appears to be fairly valued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Optex Systems Holdings 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 | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.45 | 0.57 |
| Cost of equity | 5.9% | 8.0% |
| Cost of debt | 4.5% | 4.5% |
| Tax rate | 19.5% | 21.5% |
| Debt/Equity ratio | 0.02 | 0.02 |
| After-tax WACC | 5.9% | 8.0% |
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 | $8 | $52M | 77.5% |
| 10-Year Growth | $11 | $74M | 62.4% |
| 5-Year EBITDA | $11 | $70M | 83.1% |
| 10-Year EBITDA | $13 | $84M | 66.6% |
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 | $2M |
| Discount Rate (WACC) | 8.0% - 5.9% |
| Enterprise Value | $27M - $36M |
| Net Debt | $(4)M |
| Equity Value | $30M - $39M |
| Outstanding Shares | 7M |
| Fair Value | $4 - $6 |
| Selected Fair Value | $5.02 |
| Metric | Value |
|---|---|
| Market Capitalization | $69M |
| Enterprise Value | $66M |
| Trailing P/E | 14.16 |
| Forward P/E | 16.01 |
| Trailing EV/EBITDA | 10.00 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.02 |
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% | $3.38 |
| Discounted Cash Flow (5Y) | 25% | $2.02 |
| Dividend Discount Model (Multi-Stage) | 20% | $1.82 |
| Dividend Discount Model (Stable) | 15% | $1.43 |
| Earnings Power Value | 10% | $0.50 |
| Weighted Average | 100% | $9.15 |
Based on our comprehensive valuation analysis, Optex Systems Holdings Inc's weighted average intrinsic value is $9.15, which is approximately 8.6% below the current market price of $10.01.
Key investment considerations:
Given these factors, we believe Optex Systems Holdings Inc is currently fairly valued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.