As of June 19, 2025, PIMCO Dynamic Income Fund has a Discounted Cash Flow (DCF) derived fair value of $12.12 per share. With the current market price at $18.63, this represents a potential upside of -34.9%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $9.54 |
| DCF Fair Value (10-year) | $12.12 |
| Potential Upside (5-year) | -48.8% |
| Potential Upside (10-year) | -34.9% |
| Discount Rate (WACC) | 6.8% - 9.1% |
Revenue is projected to grow from $811 million in 06-2024 to $1190 million by 06-2034, representing a compound annual growth rate of approximately 3.9%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 06-2024 | 811 | 5% |
| 06-2025 | 837 | 3% |
| 06-2026 | 886 | 6% |
| 06-2027 | 908 | 3% |
| 06-2028 | 940 | 4% |
| 06-2029 | 976 | 4% |
| 06-2030 | 1030 | 6% |
| 06-2031 | 1091 | 6% |
| 06-2032 | 1143 | 5% |
| 06-2033 | 1166 | 2% |
| 06-2034 | 1190 | 2% |
Net profit margin is expected to improve from 69% in 06-2024 to 51% by 06-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 06-2024 | 563 | 69% |
| 06-2025 | 424 | 51% |
| 06-2026 | 449 | 51% |
| 06-2027 | 460 | 51% |
| 06-2028 | 476 | 51% |
| 06-2029 | 494 | 51% |
| 06-2030 | 522 | 51% |
| 06-2031 | 553 | 51% |
| 06-2032 | 579 | 51% |
| 06-2033 | 591 | 51% |
| 06-2034 | 603 | 51% |
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) |
|---|---|
| 06-2025 | 0 |
| 06-2026 | 0 |
| 06-2027 | 0 |
| 06-2028 | 0 |
| 06-2029 | 0 |
| 06-2030 | 0 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 0 |
| Days Inventory | 0 |
| Days Payables | 533 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2025 | 291 | 78 | 0 | (64) | 276 |
| 2026 | 615 | 166 | 0 | 35 | 414 |
| 2027 | 630 | 170 | 0 | (10) | 470 |
| 2028 | 652 | 176 | 0 | (37) | 513 |
| 2029 | 677 | 183 | 0 | (2) | 497 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 9.54 | -48.8% |
| 10-Year DCF (Growth) | 12.12 | -34.9% |
| 5-Year DCF (EBITDA) | 19.92 | 6.9% |
| 10-Year DCF (EBITDA) | 21.00 | 12.7% |
Is PIMCO Dynamic Income Fund (PDI) a buy or a sell? PIMCO Dynamic Income Fund is definitely a sell. Based on our DCF analysis, PIMCO Dynamic Income Fund (PDI) appears to be overvalued with upside potential of -34.9%. 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 $18.63.