As of June 9, 2025, Vertu Motors PLC's estimated intrinsic value ranges from $38.25 to $619.66 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $118.07 | +83.3% |
| Discounted Cash Flow (5Y) | $99.99 | +55.3% |
| Dividend Discount Model (Multi-Stage) | $42.04 | -34.7% |
| Dividend Discount Model (Stable) | $38.25 | -40.6% |
| Earnings Power Value | $619.66 | +862.2% |
Is Vertu Motors PLC (VTU.L) undervalued or overvalued?
With the current market price at $64.40, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Vertu Motors PLC'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 | 4.0% | 4.5% |
| Equity market risk premium | 6.0% | 7.0% |
| Adjusted beta | 1.21 | 1.47 |
| Cost of equity | 11.2% | 15.3% |
| Cost of debt | 7.6% | 8.1% |
| Tax rate | 24.9% | 26.1% |
| Debt/Equity ratio | 1.14 | 1.14 |
| After-tax WACC | 8.3% | 10.3% |
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 | $100 | $477M | 67.8% |
| 10-Year Growth | $118 | $534M | 47.0% |
| 5-Year EBITDA | $66 | $370M | 58.4% |
| 10-Year EBITDA | $95 | $461M | 38.6% |
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 | $195M |
| Discount Rate (WACC) | 10.3% - 8.3% |
| Enterprise Value | $1,891M - $2,352M |
| Net Debt | $161M |
| Equity Value | $1,730M - $2,191M |
| Outstanding Shares | 3M |
| Fair Value | $547 - $692 |
| Selected Fair Value | $619.66 |
| Metric | Value |
|---|---|
| Market Capitalization | $204M |
| Enterprise Value | $364M |
| Trailing P/E | 11.26 |
| Forward P/E | 10.10 |
| Trailing EV/EBITDA | 3.85 |
| Current Dividend Yield | 390.33% |
| Dividend Growth Rate (5Y) | 8.05% |
| Debt-to-Equity Ratio | 1.14 |
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% | $35.42 |
| Discounted Cash Flow (5Y) | 25% | $25.00 |
| Dividend Discount Model (Multi-Stage) | 20% | $8.41 |
| Dividend Discount Model (Stable) | 15% | $5.74 |
| Earnings Power Value | 10% | $61.97 |
| Weighted Average | 100% | $136.53 |
Based on our comprehensive valuation analysis, Vertu Motors PLC's weighted average intrinsic value is $136.53, which is approximately 112.0% above the current market price of $64.40.
Key investment considerations:
Given these factors, we believe Vertu Motors PLC is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.