As of December 15, 2025, Thermon Group Holdings Inc's estimated intrinsic value ranges from $21.05 to $62.78 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $62.78 | +56.0% |
| Discounted Cash Flow (5Y) | $45.28 | +12.5% |
| Dividend Discount Model (Multi-Stage) | $34.48 | -14.3% |
| Dividend Discount Model (Stable) | $26.54 | -34.0% |
| Earnings Power Value | $21.05 | -47.7% |
Is Thermon Group Holdings Inc (THR) undervalued or overvalued?
With the current market price at $40.23, the stock appears to be fairly valued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Thermon Group Holdings 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 | 0.92 | 1.13 |
| Cost of equity | 8.1% | 11.2% |
| Cost of debt | 4.8% | 5.6% |
| Tax rate | 27.0% | 30.2% |
| Debt/Equity ratio | 0.11 | 0.11 |
| After-tax WACC | 7.7% | 10.5% |
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 | $45 | $1,596M | 77.7% |
| 10-Year Growth | $63 | $2,171M | 62.7% |
| 5-Year EBITDA | $55 | $1,928M | 81.6% |
| 10-Year EBITDA | $72 | $2,478M | 67.4% |
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 | $71M |
| Discount Rate (WACC) | 10.5% - 7.7% |
| Enterprise Value | $675M - $926M |
| Net Debt | $109M |
| Equity Value | $566M - $817M |
| Outstanding Shares | 33M |
| Fair Value | $17 - $25 |
| Selected Fair Value | $21.05 |
| Metric | Value |
|---|---|
| Market Capitalization | $1321M |
| Enterprise Value | $1430M |
| Trailing P/E | 22.38 |
| Forward P/E | 21.18 |
| Trailing EV/EBITDA | 12.85 |
| Current Dividend Yield | 0.00% |
| Dividend Growth Rate (5Y) | 0.00% |
| Debt-to-Equity Ratio | 0.11 |
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% | $18.83 |
| Discounted Cash Flow (5Y) | 25% | $11.32 |
| Dividend Discount Model (Multi-Stage) | 20% | $6.90 |
| Dividend Discount Model (Stable) | 15% | $3.98 |
| Earnings Power Value | 10% | $2.11 |
| Weighted Average | 100% | $43.13 |
Based on our comprehensive valuation analysis, Thermon Group Holdings Inc's intrinsic value is $43.13, which is approximately 7.2% above the current market price of $40.23.
Key investment considerations:
Given these factors, we believe Thermon Group Holdings Inc is currently fairly valued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.