As of June 8, 2025, ePlus inc's estimated intrinsic value ranges from $75.39 to $114.45 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $114.45 | +61.0% |
| Discounted Cash Flow (5Y) | $93.25 | +31.1% |
| Dividend Discount Model (Multi-Stage) | $75.39 | +6.0% |
| Dividend Discount Model (Stable) | $86.54 | +21.7% |
| Earnings Power Value | $92.70 | +30.4% |
Is ePlus inc (PLUS) undervalued or overvalued?
With the current market price at $71.11, the stock appears to be significantly 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 ePlus inc'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 | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.41 | 0.58 |
| Cost of equity | 5.8% | 8.1% |
| Cost of debt | 4.5% | 7.5% |
| Tax rate | 27.8% | 28.1% |
| Debt/Equity ratio | 0.02 | 0.02 |
| After-tax WACC | 5.7% | 8.0% |
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 | $93 | $2,123M | 84.3% |
| 10-Year Growth | $114 | $2,686M | 69.5% |
| 5-Year EBITDA | $62 | $1,306M | 74.4% |
| 10-Year EBITDA | $82 | $1,825M | 55.1% |
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 | $141M |
| Discount Rate (WACC) | 8.0% - 5.7% |
| Enterprise Value | $1,750M - $2,468M |
| Net Debt | $(351)M |
| Equity Value | $2,101M - $2,818M |
| Outstanding Shares | 27M |
| Fair Value | $79 - $106 |
| Selected Fair Value | $92.70 |
| Metric | Value |
|---|---|
| Market Capitalization | $1887M |
| Enterprise Value | $1536M |
| Trailing P/E | 17.47 |
| Forward P/E | 16.48 |
| Trailing EV/EBITDA | 6.50 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.02 |
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% | $34.34 |
| Discounted Cash Flow (5Y) | 25% | $23.31 |
| Dividend Discount Model (Multi-Stage) | 20% | $15.08 |
| Dividend Discount Model (Stable) | 15% | $12.98 |
| Earnings Power Value | 10% | $9.27 |
| Weighted Average | 100% | $94.98 |
Based on our comprehensive valuation analysis, ePlus inc's weighted average intrinsic value is $94.98, which is approximately 33.6% above the current market price of $71.11.
Key investment considerations:
Given these factors, we believe ePlus inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.