As of June 9, 2025, Telit Communications PLC's estimated intrinsic value ranges from $123.89 to $441.22 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $363.40 | +58.7% |
| Discounted Cash Flow (5Y) | $259.48 | +13.3% |
| Dividend Discount Model (Multi-Stage) | $180.22 | -21.3% |
| Dividend Discount Model (Stable) | $441.22 | +92.7% |
| Earnings Power Value | $123.89 | -45.9% |
Is Telit Communications PLC (TCM.L) undervalued or overvalued?
With the current market price at $229.00, 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 Telit Communications PLC'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 | 2.9% | 3.4% |
| Equity market risk premium | 5.3% | 6.3% |
| Adjusted beta | 0.89 | 0.98 |
| Cost of equity | 7.7% | 10.2% |
| Cost of debt | 4.0% | 4.5% |
| Tax rate | 11.7% | 16.6% |
| Debt/Equity ratio | 0.12 | 0.12 |
| After-tax WACC | 7.2% | 9.5% |
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 | $316 | $367M | 77.9% |
| 10-Year Growth | $442 | $537M | 62.3% |
| 5-Year EBITDA | $401 | $481M | 83.1% |
| 10-Year EBITDA | $483 | $591M | 65.7% |
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 | $12M |
| Discount Rate (WACC) | 9.5% - 7.2% |
| Enterprise Value | $126M - $166M |
| Net Debt | $(56)M |
| Equity Value | $183M - $222M |
| Outstanding Shares | 1M |
| Fair Value | $136 - $166 |
| Selected Fair Value | $123.89 |
| Metric | Value |
|---|---|
| Market Capitalization | $307M |
| Enterprise Value | $265M |
| Trailing P/E | 7.71 |
| Forward P/E | 34.46 |
| Trailing EV/EBITDA | 7.90 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.12 |
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% | $109.02 |
| Discounted Cash Flow (5Y) | 25% | $64.87 |
| Dividend Discount Model (Multi-Stage) | 20% | $36.04 |
| Dividend Discount Model (Stable) | 15% | $66.18 |
| Earnings Power Value | 10% | $12.39 |
| Weighted Average | 100% | $288.51 |
Based on our comprehensive valuation analysis, Telit Communications PLC's weighted average intrinsic value is $288.51, which is approximately 26.0% above the current market price of $229.00.
Key investment considerations:
Given these factors, we believe Telit Communications PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.