As of June 19, 2025, RPM International Inc has a Discounted Cash Flow (DCF) derived fair value of $139.90 per share. With the current market price at $107.02, this represents a potential upside of 30.7%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $118.99 |
| DCF Fair Value (10-year) | $139.90 |
| Potential Upside (5-year) | 11.2% |
| Potential Upside (10-year) | 30.7% |
| Discount Rate (WACC) | 6.9% - 9.1% |
Revenue is projected to grow from $7335 million in 05-2024 to $11454 million by 05-2034, representing a compound annual growth rate of approximately 4.6%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 05-2024 | 7335 | 1% |
| 05-2025 | 7383 | 1% |
| 05-2026 | 7624 | 3% |
| 05-2027 | 7885 | 3% |
| 05-2028 | 8275 | 5% |
| 05-2029 | 8785 | 6% |
| 05-2030 | 9341 | 6% |
| 05-2031 | 9875 | 6% |
| 05-2032 | 10479 | 6% |
| 05-2033 | 10735 | 2% |
| 05-2034 | 11454 | 7% |
Net profit margin is expected to improve from 8% in 05-2024 to 12% by 05-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 05-2024 | 589 | 8% |
| 05-2025 | 658 | 9% |
| 05-2026 | 746 | 10% |
| 05-2027 | 838 | 11% |
| 05-2028 | 948 | 11% |
| 05-2029 | 1078 | 12% |
| 05-2030 | 1146 | 12% |
| 05-2031 | 1212 | 12% |
| 05-2032 | 1286 | 12% |
| 05-2033 | 1317 | 12% |
| 05-2034 | 1405 | 12% |
with a 5-year average of $199 million. Projected CapEx is expected to maintain at approximately 3% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 05-2025 | 214 |
| 05-2026 | 228 |
| 05-2027 | 231 |
| 05-2028 | 230 |
| 05-2029 | 240 |
| 05-2030 | 251 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 78 |
| Days Inventory | 92 |
| Days Payables | 59 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 3M/2025 | 292 | 55 | 55 | 41 | 139 |
| 2026 | 1300 | 251 | 229 | 21 | 799 |
| 2027 | 1429 | 282 | 237 | 27 | 883 |
| 2028 | 1578 | 319 | 248 | 126 | 885 |
| 2029 | 1767 | 363 | 263 | 110 | 1030 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 118.99 | 11.2% |
| 10-Year DCF (Growth) | 139.90 | 30.7% |
| 5-Year DCF (EBITDA) | 94.22 | -12.0% |
| 10-Year DCF (EBITDA) | 116.97 | 9.3% |
Is RPM International Inc (RPM) a buy or a sell? RPM International Inc is definitely a buy. Based on our DCF analysis, RPM International Inc (RPM) appears to be significantly undervalued with upside potential of 30.7%. 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 $107.02.