As of June 6, 2025, Top 10 Canadian Financial Trust has a Discounted Cash Flow (DCF) derived fair value of $2.37 per share. With the current market price at $9.03, this represents a potential upside of -73.7%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $2.16 |
| DCF Fair Value (10-year) | $2.37 |
| Potential Upside (5-year) | -76.0% |
| Potential Upside (10-year) | -73.7% |
| Discount Rate (WACC) | 6.1% - 8.0% |
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2020 | 0 | 94% |
| 12-2021 | 0 | 5% |
| 12-2022 | 0 | 2% |
| 12-2023 | 0 | 2% |
| 12-2024 | 0 | 2% |
| 12-2025 | 0 | 2% |
| 12-2026 | 0 | 3% |
| 12-2027 | 0 | 4% |
| 12-2028 | 0 | 2% |
| 12-2029 | 0 | 6% |
| 12-2030 | 0 | 2% |
Net profit margin is expected to improve from -596% in 12-2020 to -101% by 12-2030, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2020 | (1) | -596% |
| 12-2021 | (1) | -79% |
| 12-2022 | (1) | -80% |
| 12-2023 | (1) | -82% |
| 12-2024 | (1) | -83% |
| 12-2025 | (1) | -85% |
| 12-2026 | (1) | -87% |
| 12-2027 | (1) | -91% |
| 12-2028 | (1) | -93% |
| 12-2029 | (1) | -99% |
| 12-2030 | (1) | -101% |
with a 5-year average of $0 million. Projected CapEx is expected to maintain at approximately 0% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2021 | 0 |
| 12-2022 | 0 |
| 12-2023 | 0 |
| 12-2024 | 0 |
| 12-2025 | 0 |
| 12-2026 | 0 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | (6) |
| Days Inventory | 0 |
| Days Payables | 0 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2021 | (0) | (0) | 0 | (0) | 0 |
| 2022 | (0) | (0) | 0 | 0 | 0 |
| 2023 | (0) | (0) | 0 | (0) | 0 |
| 2024 | (0) | (0) | 0 | (0) | 0 |
| 2025 | (0) | (0) | 0 | 0 | 0 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 2.16 | -76.0% |
| 10-Year DCF (Growth) | 2.37 | -73.7% |
| 5-Year DCF (EBITDA) | 0.00 | -100.0% |
| 10-Year DCF (EBITDA) | 0.57 | -93.7% |
Is Top 10 Canadian Financial Trust (TCT.UN.TO) a buy or a sell? Top 10 Canadian Financial Trust is definitely a sell. Based on our DCF analysis, Top 10 Canadian Financial Trust (TCT.UN.TO) appears to be overvalued with upside potential of -73.7%. 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 reducing exposure at the current market price of $9.03.