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Curtiss-Wright Corporation (CW) Intrinsic Value

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

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Curtiss-Wright Corporation (CW)

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Intrinsic Value (DCF)

Current$635.74
→
Intrinsic$207.62
-67%
$135.14$207.62$345.42
Current price reflects execution expectations above 8% growth — not unreasonable for quality businesses.
Range: Bear $135 → Bull $345. Current price implies expectations above the base case, closer to bull expectations.
Current price reflects assumptions at the upper end of our valuation range (bull case: $345).
Discount ↓Growth →4%6%8%10%
8%$250$275$302$330
10%$172$189$208$227
12%$129$142$155$170
14%$101$111$122$134

Bull Case

  • Bull case ($345) with 10% growth, 9% discount rate
  • Conservative 8% growth assumption is achievable based on track record

Bear Case

  • Bear case ($135) implies 79% downside at 6% growth, 12% discount
  • Trading 67% above base case — execution must exceed assumptions to justify
  • Price exceeds bull case ($345) — requires exceptional execution
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5-Year Free Cash Flow Projection

Year 1$522.40M
Year 2$564.67M
Year 3$610.36M
Year 4$659.74M
Year 5$713.12M
Terminal$10.49B

📐 Model Inputs

Growth Rate8.1%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$483.30MTTM 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 CW stock undervalued or overvalued?
🔴 OVERVALUED

CW trades at $635.74 vs. our DCF-derived intrinsic value of $207.62, implying -65% downside. Using a 10.0% WACC and 8.1% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($292.48) suggests limited upside.

What is CW's intrinsic value?

Using a 5-year DCF model: Base FCF of $483M, projected at 8.1% 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 $842M net debt and dividing by 0.04B shares: Bear $144.22 | Base $207.62 | Bull $292.48. Current price $635.74 implies -65% to base case.

How is CW's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 8.1% 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 ($8.81B).

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: 18.2x.