As of June 6, 2025, Tredegar Corp's estimated intrinsic value ranges from $0.01 to $27.39 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $0.01 | -99.8% |
| Discounted Cash Flow (5Y) | $0.04 | -99.5% |
| Dividend Discount Model (Multi-Stage) | $0.19 | -97.8% |
| Earnings Power Value | $27.39 | +221.1% |
Is Tredegar Corp (TG) undervalued or overvalued?
With the current market price at $8.53, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Tredegar Corp'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 | 0.68 | 0.86 |
| Cost of equity | 7.0% | 9.7% |
| Cost of debt | 6.7% | 15.6% |
| Tax rate | 26.5% | 32.1% |
| Debt/Equity ratio | 0.21 | 0.21 |
| After-tax WACC | 6.6% | 9.9% |
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 | $0 | $54M | 46.1% |
| 10-Year Growth | $0 | $53M | 33.7% |
| 5-Year EBITDA | $2 | $119M | 75.2% |
| 10-Year EBITDA | $1 | $104M | 65.8% |
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 | $80M |
| Discount Rate (WACC) | 9.9% - 6.6% |
| Enterprise Value | $811M - $1,208M |
| Net Debt | $53M |
| Equity Value | $758M - $1,155M |
| Outstanding Shares | 35M |
| Fair Value | $22 - $33 |
| Selected Fair Value | $27.39 |
| Metric | Value |
|---|---|
| Market Capitalization | $298M |
| Enterprise Value | $351M |
| Trailing P/E | 0.00 |
| Forward P/E | 527.80 |
| Trailing EV/EBITDA | 5.45 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | -100.00% |
| Debt-to-Equity Ratio | 0.21 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 35% | $0.00 |
| Discounted Cash Flow (5Y) | 29% | $0.01 |
| Dividend Discount Model (Multi-Stage) | 24% | $0.04 |
| Earnings Power Value | 12% | $2.74 |
| Weighted Average | 100% | $3.29 |
Based on our comprehensive valuation analysis, Tredegar Corp's weighted average intrinsic value is $3.29, which is approximately 61.5% below the current market price of $8.53.
Key investment considerations:
Given these factors, we believe Tredegar Corp is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.