As of December 15, 2025, Polar Capital Technology Trust PLC has a Discounted Cash Flow (DCF) derived fair value of $221.72 per share. With the current market price at $459.50, this represents a potential upside of -51.7%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $226.72 |
| DCF Fair Value (10-year) | $221.72 |
| Potential Upside (5-year) | -50.7% |
| Potential Upside (10-year) | -51.7% |
| Discount Rate (WACC) | 8.1% - 9.9% |
Revenue is projected to grow from $155 million in 04-2025 to $206 million by 04-2035, representing a compound annual growth rate of approximately 2.9%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 04-2025 | 155 | 86% |
| 04-2026 | 163 | 5% |
| 04-2027 | 167 | 3% |
| 04-2028 | 171 | 2% |
| 04-2029 | 174 | 2% |
| 04-2030 | 178 | 2% |
| 04-2031 | 181 | 2% |
| 04-2032 | 185 | 2% |
| 04-2033 | 190 | 3% |
| 04-2034 | 198 | 4% |
| 04-2035 | 206 | 4% |
Net profit margin is expected to improve from 76% in 04-2025 to 83% by 04-2035, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 04-2025 | 118 | 76% |
| 04-2026 | 128 | 78% |
| 04-2027 | 133 | 79% |
| 04-2028 | 137 | 80% |
| 04-2029 | 141 | 81% |
| 04-2030 | 146 | 82% |
| 04-2031 | 149 | 82% |
| 04-2032 | 152 | 82% |
| 04-2033 | 157 | 82% |
| 04-2034 | 164 | 83% |
| 04-2035 | 170 | 83% |
with a 5-year average of $0 million. Projected CapEx is expected to maintain at approximately 0% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 04-2026 | 0 |
| 04-2027 | 0 |
| 04-2028 | 0 |
| 04-2029 | 0 |
| 04-2030 | 0 |
| 04-2031 | 0 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 5 |
| Days Inventory | 0 |
| Days Payables | 196 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2026 | 129 | 1 | 0 | (36) | 164 |
| 2027 | 134 | 1 | 0 | 17 | 115 |
| 2028 | 138 | 1 | 0 | 3 | 135 |
| 2029 | 143 | 1 | 0 | (6) | 148 |
| 2030 | 147 | 1 | 0 | 5 | 141 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 226.72 | -50.7% |
| 10-Year DCF (Growth) | 221.72 | -51.7% |
| 5-Year DCF (EBITDA) | 143.66 | -68.7% |
| 10-Year DCF (EBITDA) | 159.36 | -65.3% |
Is Polar Capital Technology Trust PLC (PCT.L) a buy or a sell? Polar Capital Technology Trust PLC is definitely a sell. Based on our DCF analysis, Polar Capital Technology Trust PLC (PCT.L) appears to be overvalued with upside potential of -51.7%. 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 $459.50.