As of May 29, 2025, ORBCOMM Inc has a Discounted Cash Flow (DCF) derived fair value of $4.42 per share. With the current market price at $11.49, this represents a potential upside of -61.5%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $0.60 |
| DCF Fair Value (10-year) | $4.42 |
| Potential Upside (5-year) | -94.8% |
| Potential Upside (10-year) | -61.5% |
| Discount Rate (WACC) | 5.2% - 7.1% |
Revenue is projected to grow from $248 million in 12-2020 to $507 million by 12-2030, representing a compound annual growth rate of approximately 7.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2020 | 248 | 9% |
| 12-2021 | 273 | 10% |
| 12-2022 | 303 | 11% |
| 12-2023 | 315 | 4% |
| 12-2024 | 338 | 7% |
| 12-2025 | 351 | 4% |
| 12-2026 | 382 | 9% |
| 12-2027 | 412 | 8% |
| 12-2028 | 443 | 8% |
| 12-2029 | 482 | 9% |
| 12-2030 | 507 | 5% |
Net profit margin is expected to improve from -14% in 12-2020 to -1% by 12-2030, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2020 | (34) | -14% |
| 12-2021 | (23) | -8% |
| 12-2022 | (20) | -7% |
| 12-2023 | (16) | -5% |
| 12-2024 | (12) | -3% |
| 12-2025 | (7) | -2% |
| 12-2026 | (6) | -2% |
| 12-2027 | (6) | -1% |
| 12-2028 | (5) | -1% |
| 12-2029 | (4) | -1% |
| 12-2030 | (3) | -1% |
with a 5-year average of $24 million. Projected CapEx is expected to maintain at approximately 10% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2021 | 23 |
| 12-2022 | 24 |
| 12-2023 | 26 |
| 12-2024 | 28 |
| 12-2025 | 31 |
| 12-2026 | 34 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 78 |
| Days Inventory | 97 |
| Days Payables | 44 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2021 | 7 | (3) | 14 | 4 | (7) |
| 2022 | 21 | (6) | 30 | 8 | (12) |
| 2023 | 29 | (4) | 31 | 0 | 2 |
| 2024 | 39 | (3) | 34 | 6 | 2 |
| 2025 | 49 | (2) | 35 | 2 | 14 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 0.60 | -94.8% |
| 10-Year DCF (Growth) | 4.42 | -61.5% |
| 5-Year DCF (EBITDA) | 5.76 | -49.9% |
| 10-Year DCF (EBITDA) | 9.29 | -19.2% |
Is ORBCOMM Inc (ORBC) a buy or a sell? ORBCOMM Inc is definitely a sell. Based on our DCF analysis, ORBCOMM Inc (ORBC) appears to be overvalued with upside potential of -61.5%. 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 reducing exposure at the current market price of $11.49.