As of June 3, 2025, Taitron Components Inc's estimated intrinsic value ranges from $0.10 to $10.50 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $3.14 | +42.9% |
| Discounted Cash Flow (5Y) | $3.00 | +36.4% |
| Dividend Discount Model (Multi-Stage) | $10.50 | +377.1% |
| Dividend Discount Model (Stable) | $0.10 | -95.7% |
| Earnings Power Value | $3.00 | +36.3% |
Is Taitron Components Inc (TAIT) undervalued or overvalued?
With the current market price at $2.20, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Taitron Components Inc's intrinsic value, including:
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 | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 1.03 | 1.2 |
| Cost of equity | 8.6% | 11.6% |
| Cost of debt | 5.0% | 5.0% |
| Tax rate | 17.5% | 25.5% |
| Debt/Equity ratio | 1 | 1 |
| After-tax WACC | 6.4% | 7.7% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $3 | $14M | 71.1% |
| 10-Year Growth | $3 | $15M | 52.9% |
| 5-Year EBITDA | $3 | $11M | 64.4% |
| 10-Year EBITDA | $3 | $13M | 45.0% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
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) | 7.7% - 6.4% |
| Enterprise Value | $13M - $15M |
| Net Debt | $(4)M |
| Equity Value | $17M - $19M |
| Outstanding Shares | 6M |
| Fair Value | $3 - $3 |
| Selected Fair Value | $3.00 |
| Metric | Value |
|---|---|
| Market Capitalization | $13M |
| Enterprise Value | $9M |
| Trailing P/E | 206.94 |
| Forward P/E | 11.12 |
| Trailing EV/EBITDA | 7.50 |
| Current Dividend Yield | 904.98% |
| Dividend Growth Rate (5Y) | 9.42% |
| Debt-to-Equity Ratio | 0.82 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $0.94 |
| Discounted Cash Flow (5Y) | 25% | $0.75 |
| Dividend Discount Model (Multi-Stage) | 20% | $2.10 |
| Dividend Discount Model (Stable) | 15% | $0.01 |
| Earnings Power Value | 10% | $0.30 |
| Weighted Average | 100% | $4.11 |
Based on our comprehensive valuation analysis, Taitron Components Inc's weighted average intrinsic value is $4.11, which is approximately 86.7% above the current market price of $2.20.
Key investment considerations:
Given these factors, we believe Taitron Components Inc is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.