As of May 22, 2025, PIMCO Global Income Opportunities Fund's estimated intrinsic value ranges from $1.28 to $10.98 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $10.98 | +51.7% |
| Discounted Cash Flow (5Y) | $9.82 | +35.6% |
| Dividend Discount Model (Multi-Stage) | $7.17 | -1.0% |
| Dividend Discount Model (Stable) | $8.18 | +13.0% |
| Earnings Power Value | $1.28 | -82.3% |
Is PIMCO Global Income Opportunities Fund (PGI.UN.TO) undervalued or overvalued?
With the current market price at $7.24, the stock appears to be moderately undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate PIMCO Global Income Opportunities Fund'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 | 3.2% | 3.7% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.79 | 0.8 |
| Cost of equity | 7.2% | 9.1% |
| Cost of debt | 4.4% | 4.9% |
| Tax rate | 25.9% | 26.5% |
| Debt/Equity ratio | 0.45 | 0.45 |
| After-tax WACC | 6.0% | 7.4% |
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 | $10 | $455M | 73.9% |
| 10-Year Growth | $11 | $495M | 56.2% |
| 5-Year EBITDA | $13 | $558M | 78.8% |
| 10-Year EBITDA | $13 | $581M | 62.7% |
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 | $10M |
| Discount Rate (WACC) | 7.4% - 6.0% |
| Enterprise Value | $141M - $174M |
| Net Debt | $113M |
| Equity Value | $28M - $61M |
| Outstanding Shares | 35M |
| Fair Value | $1 - $2 |
| Selected Fair Value | $1.28 |
| Metric | Value |
|---|---|
| Market Capitalization | $252M |
| Enterprise Value | $365M |
| Trailing P/E | 9.83 |
| Forward P/E | 12.68 |
| Trailing EV/EBITDA | 16.75 |
| Current Dividend Yield | 946.86% |
| Dividend Growth Rate (5Y) | -5.50% |
| Debt-to-Equity Ratio | 0.45 |
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% | $3.29 |
| Discounted Cash Flow (5Y) | 25% | $2.46 |
| Dividend Discount Model (Multi-Stage) | 20% | $1.43 |
| Dividend Discount Model (Stable) | 15% | $1.23 |
| Earnings Power Value | 10% | $0.13 |
| Weighted Average | 100% | $8.54 |
Based on our comprehensive valuation analysis, PIMCO Global Income Opportunities Fund's weighted average intrinsic value is $8.54, which is approximately 17.9% above the current market price of $7.24.
Key investment considerations:
Given these factors, we believe PIMCO Global Income Opportunities Fund is currently moderately undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.