As of June 21, 2025, Universal Electronics Inc has a Discounted Cash Flow (DCF) derived fair value of $4.51 per share. With the current market price at $7.00, this represents a potential upside of -35.6%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $1.88 |
| DCF Fair Value (10-year) | $4.51 |
| Potential Upside (5-year) | -73.2% |
| Potential Upside (10-year) | -35.6% |
| Discount Rate (WACC) | 7.7% - 9.5% |
Revenue is projected to grow from $395 million in 12-2024 to $507 million by 12-2034, representing a compound annual growth rate of approximately 2.5%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2024 | 395 | 6% |
| 12-2025 | 409 | 3% |
| 12-2026 | 425 | 4% |
| 12-2027 | 433 | 2% |
| 12-2028 | 442 | 2% |
| 12-2029 | 451 | 2% |
| 12-2030 | 460 | 2% |
| 12-2031 | 469 | 2% |
| 12-2032 | 479 | 2% |
| 12-2033 | 497 | 4% |
| 12-2034 | 507 | 2% |
Net profit margin is expected to improve from -6% in 12-2024 to 2% by 12-2034, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2024 | (24) | -6% |
| 12-2025 | (10) | -2% |
| 12-2026 | (6) | -1% |
| 12-2027 | (2) | 0% |
| 12-2028 | 3 | 1% |
| 12-2029 | 7 | 2% |
| 12-2030 | 7 | 2% |
| 12-2031 | 7 | 2% |
| 12-2032 | 7 | 2% |
| 12-2033 | 7 | 2% |
| 12-2034 | 8 | 2% |
with a 5-year average of $17 million. Projected CapEx is expected to maintain at approximately 3% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2025 | 15 |
| 12-2026 | 14 |
| 12-2027 | 12 |
| 12-2028 | 13 |
| 12-2029 | 14 |
| 12-2030 | 14 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 89 |
| Days Inventory | 112 |
| Days Payables | 75 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 9M/2025 | 4 | (3) | 10 | 14 | (17) |
| 2026 | 10 | (2) | 13 | 2 | (3) |
| 2027 | 14 | (1) | 14 | (1) | 2 |
| 2028 | 20 | 1 | 14 | 5 | 0 |
| 2029 | 27 | 3 | 14 | 1 | 9 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 1.88 | -73.2% |
| 10-Year DCF (Growth) | 4.51 | -35.6% |
| 5-Year DCF (EBITDA) | 10.56 | 50.8% |
| 10-Year DCF (EBITDA) | 11.75 | 67.9% |
Is Universal Electronics Inc (UEIC) a buy or a sell? Universal Electronics Inc is definitely a sell. Based on our DCF analysis, Universal Electronics Inc (UEIC) appears to be overvalued with upside potential of -35.6%. 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 $7.00.