What is SBTX.L's Intrinsic value?

SkinBioTherapeutics PLC (SBTX.L) Intrinsic Value Analysis

Executive Summary

As of December 15, 2025, SkinBioTherapeutics PLC's estimated intrinsic value ranges from $5.50 to $5.50 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Earnings Power Value $5.50 -59.2%

Is SkinBioTherapeutics PLC (SBTX.L) undervalued or overvalued?

With the current market price at $13.50, the stock appears to be significantly overvalued.

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 SkinBioTherapeutics 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 0.36 0.42
Cost of equity 6.1% 8.0%
Cost of debt 7.0% 11.1%
Tax rate 3.7% 4.9%
Debt/Equity ratio 0.02 0.02
After-tax WACC 6.1% 8.0%

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 $1M
Discount Rate (WACC) 8.0% - 6.1%
Enterprise Value $12M - $16M
Net Debt $(4)M
Equity Value $16M - $19M
Outstanding Shares 3M
Fair Value $5 - $6
Selected Fair Value $5.50

Key Financial Metrics

Metric Value
Market Capitalization $43M
Enterprise Value $39M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 9.65
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.02

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% $0.55
Weighted Average 100% $5.50

Investment Conclusion

Based on our comprehensive valuation analysis, SkinBioTherapeutics PLC's intrinsic value is $5.50, which is approximately 59.2% below the current market price of $13.50.

Key investment considerations:

  • Strong projected earnings growth (-15% to -5% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.02)

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