What is RBG.L's Intrinsic value?

Revolution Bars Group PLC (RBG.L) Intrinsic Value Analysis

Executive Summary

As of May 23, 2025, Revolution Bars Group PLC's estimated intrinsic value ranges from $34.41 to $34.41 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Earnings Power Value $34.41 +5884.3%

Is Revolution Bars Group PLC (RBG.L) undervalued or overvalued?

With the current market price at $0.57, the stock appears to be significantly undervalued.

Understanding Intrinsic Value

Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Revolution Bars Group PLC's intrinsic value, including:

  1. Earnings Power Value (EPV): Values the company based on its current earnings power, assuming no growth

Weighted Average Cost of Capital (WACC)

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 0.3 0.49
Cost of equity 5.8% 8.4%
Cost of debt 10.5% 21.0%
Tax rate 0.1% 2.9%
Debt/Equity ratio 17.46 17.46
After-tax WACC 10.2% 19.7%

Valuation Methods

3. Earnings Power Value (EPV)

EPV assesses a company's value based on its current normalized earnings power, assuming no growth.

EPV Component Value
Normalized Earnings $88M
Discount Rate (WACC) 19.7% - 10.2%
Enterprise Value $446M - $861M
Net Debt $138M
Equity Value $308M - $723M
Outstanding Shares 15M
Fair Value $21 - $48
Selected Fair Value $34.41

Key Financial Metrics

Metric Value
Market Capitalization $9M
Enterprise Value $147M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 8.90
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) -100.00%
Debt-to-Equity Ratio 17.46

Investment Decision Framework

To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:

  1. Forecast Certainty: DCF methods rely on long-term projections, while earnings power value focuses on current normalized earnings
  2. Business Model Alignment: Dividend models are more appropriate for mature companies with established dividend policies
  3. Historical Accuracy: How well each method has predicted fair value historically

Valuation Weight Matrix

Valuation Method Weight Weighted Value
Earnings Power Value 100% $3.44
Weighted Average 100% $34.41

Investment Conclusion

Based on our comprehensive valuation analysis, Revolution Bars Group PLC's weighted average intrinsic value is $34.41, which is approximately 5884.3% above the current market price of $0.57.

Key investment considerations:

  • Strong projected earnings growth (-15% to -8% margin)
  • Consistent cash flow generation

Given these factors, we believe Revolution Bars Group PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.