As of June 15, 2025, Reko International Group Inc has a Discounted Cash Flow (DCF) derived fair value of $11.87 per share. With the current market price at $3.70, this represents a potential upside of 220.8%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $8.37 |
| DCF Fair Value (10-year) | $11.87 |
| Potential Upside (5-year) | 126.2% |
| Potential Upside (10-year) | 220.8% |
| Discount Rate (WACC) | 4.7% - 6.6% |
Revenue is projected to grow from $44 million in 07-2024 to $50 million by 07-2034, representing a compound annual growth rate of approximately 1.3%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 07-2024 | 44 | 5% |
| 07-2025 | 36 | -18% |
| 07-2026 | 38 | 4% |
| 07-2027 | 40 | 5% |
| 07-2028 | 42 | 4% |
| 07-2029 | 42 | 2% |
| 07-2030 | 43 | 2% |
| 07-2031 | 45 | 5% |
| 07-2032 | 48 | 5% |
| 07-2033 | 49 | 2% |
| 07-2034 | 50 | 2% |
Net profit margin is expected to improve from -9% in 07-2024 to 5% by 07-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 07-2024 | (4) | -9% |
| 07-2025 | (0) | -1% |
| 07-2026 | 0 | 1% |
| 07-2027 | 1 | 2% |
| 07-2028 | 1 | 3% |
| 07-2029 | 2 | 5% |
| 07-2030 | 2 | 5% |
| 07-2031 | 2 | 5% |
| 07-2032 | 2 | 5% |
| 07-2033 | 2 | 5% |
| 07-2034 | 2 | 5% |
with a 5-year average of $3 million. Projected CapEx is expected to maintain at approximately 7% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 07-2025 | 3 |
| 07-2026 | 3 |
| 07-2027 | 3 |
| 07-2028 | 3 |
| 07-2029 | 3 |
| 07-2030 | 3 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 83 |
| Days Inventory | 73 |
| Days Payables | 9 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2025 | 2 | (0) | 1 | (2) | 2 |
| 2026 | 4 | 0 | 3 | 0 | 1 |
| 2027 | 4 | 0 | 3 | 1 | 0 |
| 2028 | 4 | 0 | 3 | 0 | 1 |
| 2029 | 5 | 0 | 3 | 0 | 2 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 8.37 | 126.2% |
| 10-Year DCF (Growth) | 11.87 | 220.8% |
| 5-Year DCF (EBITDA) | 7.69 | 107.8% |
| 10-Year DCF (EBITDA) | 8.81 | 138.1% |
Is Reko International Group Inc (REKO.V) a buy or a sell? Reko International Group Inc is definitely a buy. Based on our DCF analysis, Reko International Group Inc (REKO.V) appears to be significantly undervalued with upside potential of 220.8%. 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 a strong buy at the current market price of $3.70.