What is TRAD.ST's Intrinsic value?

TradeDoubler AB (TRAD.ST) Intrinsic Value Analysis

Executive Summary

As of December 15, 2025, TradeDoubler AB's estimated intrinsic value ranges from $11.22 to $140.25 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $140.25 +2176.8%
Discounted Cash Flow (5Y) $60.61 +883.9%
Dividend Discount Model (Multi-Stage) $82.67 +1242.0%
Dividend Discount Model (Stable) $28.39 +360.9%
Earnings Power Value $11.22 +82.2%

Is TradeDoubler AB (TRAD.ST) undervalued or overvalued?

With the current market price at $6.16, the stock appears to be significantly undervalued.

Understanding Intrinsic Value

Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate TradeDoubler AB's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows
  2. Dividend Discount Model (DDM): Values the company based on expected future dividend payments
  3. Earnings Power Value (EPV): Values the company based on its current earnings power, assuming no growth

Weighted Average Cost of Capital (WACC)

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 2.5% 3.0%
Equity market risk premium 5.1% 6.1%
Adjusted beta 0.42 0.5
Cost of equity 4.7% 6.6%
Cost of debt 5.0% 5.0%
Tax rate 26.6% 39.5%
Debt/Equity ratio 0.26 0.26
After-tax WACC 4.5% 5.8%

Valuation Methods

1. Discounted Cash Flow (DCF) Valuation

Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:

  • Forecast Period: 5-year DCF and 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 5.2% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $2,113 (FY12-2024) to $5,528 (FY12-2034)
  • Net profit margin expansion from 0% to 6%
  • Capital expenditures maintained at approximately 2% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $61 $3,688M 94.6%
10-Year Growth $140 $8,565M 90.0%
5-Year EBITDA $19 $1,118M 82.2%
10-Year EBITDA $36 $2,174M 60.6%

2. Dividend Discount Model (DDM)

The DDM values a company based on its expected future dividend payments. We used two approaches:

Multi-Stage DDM:

  • Current payout ratio: 0.0%
  • Stable payout ratio: 90.0%
  • Growth transition: 5 years
  • Cost of equity: 5.6%
  • Long-term growth rate: 3.4%
  • Fair value: $82.67 (1242.0% from current price)

Stable DDM:

  • Stable payout ratio: 70% (Low) to 90% (High)
  • Cost of equity: 6.6% (Low) to 4.7% (High)
  • Long-term growth rate: 2.5% (Low) to 4.2% (High)
  • Fair value range: $5 to $52
  • Selected fair value: $28.39 (360.9% from current price)

3. Earnings Power Value (EPV)

EPV assesses a company's value based on its current normalized earnings power, assuming no growth.

EPV Component Value
Normalized Earnings $34M
Discount Rate (WACC) 5.8% - 4.5%
Enterprise Value $575M - $752M
Net Debt $(24)M
Equity Value $599M - $776M
Outstanding Shares 61M
Fair Value $10 - $13
Selected Fair Value $11.22

Key Financial Metrics

Metric Value
Market Capitalization $377M
Enterprise Value $353M
Trailing P/E 23.30
Forward P/E 12.06
Trailing EV/EBITDA 4.10
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 0.26

Investment Decision Framework

To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:

  1. Forecast Certainty: DCF methods rely on long-term projections, while earnings power value focuses on current normalized earnings
  2. Business Model Alignment: Dividend models are more appropriate for mature companies with established dividend policies
  3. Historical Accuracy: How well each method has predicted fair value historically

Valuation Weight Matrix

Valuation Method Weight Weighted Value
Discounted Cash Flow (10Y) 30% $42.07
Discounted Cash Flow (5Y) 25% $15.15
Dividend Discount Model (Multi-Stage) 20% $16.53
Dividend Discount Model (Stable) 15% $4.26
Earnings Power Value 10% $1.12
Weighted Average 100% $79.14

Investment Conclusion

Based on our comprehensive valuation analysis, TradeDoubler AB's intrinsic value is $79.14, which is approximately 1184.8% above the current market price of $6.16.

Key investment considerations:

  • Strong projected earnings growth (0% to 6% margin)
  • Consistent cash flow generation
  • Conservative capital structure (Debt/Equity of 0.26)

Given these factors, we believe TradeDoubler AB is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.