As of June 18, 2025, Winmark Corp's estimated intrinsic value ranges from $177.02 to $1591.62 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $490.71 | +10.5% |
| Discounted Cash Flow (5Y) | $501.96 | +13.0% |
| Dividend Discount Model (Multi-Stage) | $408.61 | -8.0% |
| Dividend Discount Model (Stable) | $1591.62 | +258.4% |
| Earnings Power Value | $177.02 | -60.1% |
Is Winmark Corp (WINA) undervalued or overvalued?
With the current market price at $444.04, 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 Winmark Corp'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 | 0.34 | 0.47 |
| Cost of equity | 5.4% | 7.5% |
| Cost of debt | 4.5% | 5.0% |
| Tax rate | 21.9% | 22.2% |
| Debt/Equity ratio | 0.04 | 0.04 |
| After-tax WACC | 5.4% | 7.4% |
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 | $502 | $1,810M | 89.2% |
| 10-Year Growth | $491 | $1,770M | 78.8% |
| 5-Year EBITDA | $176 | $661M | 70.5% |
| 10-Year EBITDA | $209 | $777M | 51.8% |
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 | $41M |
| Discount Rate (WACC) | 7.4% - 5.4% |
| Enterprise Value | $558M - $768M |
| Net Debt | $38M |
| Equity Value | $520M - $730M |
| Outstanding Shares | 4M |
| Fair Value | $147 - $207 |
| Selected Fair Value | $177.02 |
| Metric | Value |
|---|---|
| Market Capitalization | $1567M |
| Enterprise Value | $1606M |
| Trailing P/E | 31.41 |
| Forward P/E | 36.81 |
| Trailing EV/EBITDA | 9.75 |
| Current Dividend Yield | 258.60% |
| Dividend Growth Rate (5Y) | 28.56% |
| Debt-to-Equity Ratio | 0.04 |
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% | $147.21 |
| Discounted Cash Flow (5Y) | 25% | $125.49 |
| Dividend Discount Model (Multi-Stage) | 20% | $81.72 |
| Dividend Discount Model (Stable) | 15% | $238.74 |
| Earnings Power Value | 10% | $17.70 |
| Weighted Average | 100% | $610.87 |
Based on our comprehensive valuation analysis, Winmark Corp's weighted average intrinsic value is $610.87, which is approximately 37.6% above the current market price of $444.04.
Key investment considerations:
Given these factors, we believe Winmark Corp is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.