As of May 23, 2025, Oxford Instruments PLC's estimated intrinsic value ranges from $841.15 to $1325.35 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $1325.35 | -28.3% |
| Discounted Cash Flow (5Y) | $1173.76 | -36.5% |
| Dividend Discount Model (Multi-Stage) | $1220.76 | -33.9% |
| Dividend Discount Model (Stable) | $841.15 | -54.5% |
| Earnings Power Value | $926.37 | -49.9% |
Is Oxford Instruments PLC (OXIG.L) undervalued or overvalued?
With the current market price at $1848.00, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Oxford Instruments PLC'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 | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.03 | 1.1 |
| Cost of equity | 10.1% | 12.6% |
| Cost of debt | 4.0% | 4.6% |
| Tax rate | 19.5% | 20.1% |
| Debt/Equity ratio | 0.04 | 0.04 |
| After-tax WACC | 9.8% | 12.3% |
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 | $1,174 | $674M | 68.1% |
| 10-Year Growth | $1,325 | $762M | 45.7% |
| 5-Year EBITDA | $2,557 | $1,478M | 85.5% |
| 10-Year EBITDA | $2,408 | $1,392M | 70.3% |
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 | $58M |
| Discount Rate (WACC) | 12.3% - 9.8% |
| Enterprise Value | $472M - $589M |
| Net Debt | $(8)M |
| Equity Value | $480M - $597M |
| Outstanding Shares | 1M |
| Fair Value | $826 - $1,027 |
| Selected Fair Value | $926.37 |
| Metric | Value |
|---|---|
| Market Capitalization | $1074M |
| Enterprise Value | $1066M |
| Trailing P/E | 20.46 |
| Forward P/E | 16.55 |
| Trailing EV/EBITDA | 16.50 |
| Current Dividend Yield | 186.11% |
| Dividend Growth Rate (5Y) | 8.59% |
| Debt-to-Equity Ratio | 0.04 |
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% | $397.60 |
| Discounted Cash Flow (5Y) | 25% | $293.44 |
| Dividend Discount Model (Multi-Stage) | 20% | $244.15 |
| Dividend Discount Model (Stable) | 15% | $126.17 |
| Earnings Power Value | 10% | $92.64 |
| Weighted Average | 100% | $1154.01 |
Based on our comprehensive valuation analysis, Oxford Instruments PLC's weighted average intrinsic value is $1154.01, which is approximately 37.6% below the current market price of $1848.00.
Key investment considerations:
Given these factors, we believe Oxford Instruments PLC is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.