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Corpay, Inc. (CPAY) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Corpay, Inc. (CPAY)

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Intrinsic Value (DCF)

Current$330.77
→
Intrinsic$398.44
+20%
$243.98$398.44$692.03
Market implies 7% growth for 5 years
CPAY shows 20% potential upside using 10% growth — reasonable if fundamentals hold.
At $331, the market prices in only 7% growth — below historical 10%, suggesting low expectations.
Range: Bear $244 → Bull $692. Current price implies expectations below the base case, but well above the bear case.
Discount ↓Growth →6%8%10%12%
8%$492$544$600$660
10%$324$360$398$440
12%$231$258$287$317
14%$171$193$215$240

Bull Case

  • Bull case ($692) offers 109% upside at 12% growth, 9% discount
  • 17% margin of safety vs. base case estimate
  • Market-implied growth (7%) ≤ historical CAGR (10%)

Bear Case

  • Bear case ($244) implies 26% downside at 8% growth, 12% discount
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5-Year Free Cash Flow Projection

Year 1$1.95B
Year 2$2.14B
Year 3$2.36B
Year 4$2.60B
Year 5$2.87B
Terminal$42.19B

📐 Model Inputs

Growth Rate10.2%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$1.77BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.

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Frequently Asked Questions

Is CPAY stock undervalued or overvalued?
🟢 UNDERVALUED

CPAY trades at $330.77 vs. our DCF-derived intrinsic value of $398.44, implying +25% upside. At a 10.0% WACC and 10.2% projected FCF growth, the market appears to be underpricing the present value of CPAY's future cash flows. The bear case ($257.16) still suggests upside, providing margin of safety.

What is CPAY's intrinsic value?

Using a 5-year DCF model: Base FCF of $1.77B, projected at 10.2% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $6.44B net debt and dividing by 0.07B shares: Bear $257.16 | Base $398.44 | Bull $591.17. Current price $330.77 implies +25% to base case.

How is CPAY's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 10.2% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($35.07B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 19.9x.