What is VCOM.V's Intrinsic value?

Vivere Communities Inc (VCOM.V) Intrinsic Value Analysis

Executive Summary

As of June 18, 2025, Vivere Communities Inc's estimated intrinsic value ranges from $0.02 to $0.02 per share, depending on the valuation methodology applied.

Valuation Method Fair Value (USD) Implied Upside/Downside
Discounted Cash Flow (10Y) $0.02 -88.4%

Is Vivere Communities Inc (VCOM.V) undervalued or overvalued?

With the current market price at $0.20, the stock appears to be significantly overvalued.

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 Vivere Communities Inc's intrinsic value, including:

  1. Discounted Cash Flow (DCF): Values the company based on projected future cash flows

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 3.2% 3.7%
Equity market risk premium 4.7% 5.7%
Adjusted beta 0.48 0.9
Cost of equity 5.5% 9.3%
Cost of debt 5.0% 5.0%
Tax rate 1.7% 5.5%
Debt/Equity ratio 2.31 2.31
After-tax WACC 5.1% 6.1%

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: 10-year DCF
  • Terminal Growth Rate: 0.0% (range: 3.0% - 5.0%)
  • Discount Rate: 5.6% (range: 0.0% - 9.3%)

Key Projections:

  • Revenue growth from $4 (FY12-2020) to $5 (FY12-2030)
  • Net profit margin expansion from -61% to -54%
  • Capital expenditures maintained at approximately 0% of revenue
DCF Model Fair Value Enterprise Value % from Terminal Value
5-Year Growth $(1,234) $55M 91.0%
10-Year Growth $0 $63M 84.6%
5-Year EBITDA $(1,234) $18M 72.9%
10-Year EBITDA $(1,234) $24M 59.9%

Key Financial Metrics

Metric Value
Market Capitalization $27M
Enterprise Value $87M
Trailing P/E 0.00
Forward P/E 0.00
Trailing EV/EBITDA 18.50
Current Dividend Yield 0.00%
Dividend Growth Rate (5Y) 0.00%
Debt-to-Equity Ratio 2.31

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) 100% $0.01
Weighted Average 100% $0.02

Investment Conclusion

Based on our comprehensive valuation analysis, Vivere Communities Inc's weighted average intrinsic value is $0.02, which is approximately 88.4% below the current market price of $0.20.

Key investment considerations:

  • Strong projected earnings growth (-61% to -54% margin)
  • Consistent cash flow generation

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