What is SPNE's DCF valuation?

SeaSpine Holdings Corp (SPNE) DCF Valuation Analysis

Executive Summary

As of April 4, 2026, SeaSpine Holdings Corp has a Discounted Cash Flow (DCF) derived fair value of $0.00 per share. With the current market price at $9.54, this represents a potential upside of -1000.5%.

Key Metrics Value
DCF Fair Value (5-year) $0.00
DCF Fair Value (10-year) $0.00
Potential Upside (5-year) -881.9%
Potential Upside (10-year) -1000.5%
Discount Rate (WACC) 6.2% - 6.9%

Financial Performance & Projections

Revenue Trends

Revenue is projected to grow from $191 million in 12-2021 to $545 million by 12-2031, representing a compound annual growth rate of approximately 11.1%.

Fiscal Year Revenue (USD millions) Growth
12-2021 191 24%
12-2022 229 20%
12-2023 260 14%
12-2024 289 11%
12-2025 319 11%
12-2026 350 10%
12-2027 390 11%
12-2028 430 10%
12-2029 459 7%
12-2030 495 8%
12-2031 545 10%

Profitability Projections

Net profit margin is expected to improve from -28% in 12-2021 to -18% by 12-2031, driven by operational efficiency and economies of scale.

Fiscal Year Net Profit (USD millions) Profit Margin
12-2021 (54) -28%
12-2022 (61) -27%
12-2023 (65) -25%
12-2024 (66) -23%
12-2025 (68) -21%
12-2026 (69) -20%
12-2027 (76) -19%
12-2028 (82) -19%
12-2029 (86) -19%
12-2030 (92) -19%
12-2031 (99) -18%

DCF Model Components

1. Capital Expenditures (CapEx)

with a 5-year average of $15 million. Projected CapEx is expected to maintain at approximately 9% of revenue.

2. Depreciation & Amortization

Depreciation is based on an average useful life of 5 years for capital assets.

Fiscal Year D&A (USD millions)
12-2022 17
12-2023 20
12-2024 23
12-2025 25
12-2026 26
12-2027 29

3. Working Capital Requirements

Net working capital is expected to increase gradually, with projected changes affecting free cash flow.

Components Average Days
Days Receivables 63
Days Inventory 330
Days Payables 59

4. Free Cash Flow Projections

Fiscal Year EBITDA Tax CapEx Change in NWC FCF
3M/2022 (11) (0) 5 4 (20)
2023 (45) (1) 23 14 (81)
2024 (44) (1) 26 6 (76)
2025 (44) (1) 29 10 (81)
2026 (44) (1) 32 9 (84)

DCF Valuation Parameters

Key Assumptions

  • Discount Rate (WACC): WACC / Discount Rate (selected: 6.2% - 6.9%)
  • Long-Term Growth Rate: Long-term Growth Rate (selected: 3.0% - 5.0%)
  • Terminal EV/EBITDA Multiple: 11.9x (based on peer average)

Valuation Summary

Valuation Method Fair Price (USD) Potential Upside
5-Year DCF (Growth) 0.00 -881.9%
10-Year DCF (Growth) 0.00 -1000.5%
5-Year DCF (EBITDA) 0.00 -100.0%
10-Year DCF (EBITDA) 0.00 -100.0%

Enterprise Value Breakdown

  • 5-Year Model: $(2,796)M
  • 10-Year Model: $(3,217)M

Investment Conclusion

Is SeaSpine Holdings Corp (SPNE) a buy or a sell? SeaSpine Holdings Corp is definitely a sell. Based on our DCF analysis, SeaSpine Holdings Corp (SPNE) appears to be overvalued with upside potential of -1000.5%. 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:

  • Expanding profit margins (from -28% to -18%)
  • Steady revenue growth (11.1% CAGR)
  • Strong free cash flow generation

Investors should consider reducing exposure at the current market price of $9.54.