MODEL VERDICT
Drilling Tools International Corp. (DTI)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 37 analyst estimates | $3.02 | -18.8% | 20% | A- | Analyst Est. |
| EV/EBITDA 39 industry peers | $11.13 | +199.2% | 20% | A- | Peer Data |
| Industry Median P/E 35 industry peers | $2.17 | -41.7% | 15% | A | Peer Data |
| EV/EBIT 37 industry peers | $4.90 | +31.7% | 8% | B+ | Peer Data |
| EV To Revenue 43 industry peers | $5.87 | +57.8% | 4% | B | Data |
| Price / Sales 43 industry peers | $6.58 | +76.9% | 3% | B | Model Driven |
| Earnings Yield 36 industry peers | $2.21 | -40.6% | 2% | B | Data |
| Weighted Output Blended model output | $5.49 | +47.5% | 100% | 51 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 34× | 37× | 40× (Current) | 43× | 46× |
|---|---|---|---|---|---|
| Bear Case (4%) | $3 | $4 | $4 | $4 | $4 |
| Conservative (7%) | $3 | $4 | $4 | $4 | $5 |
| Base Case (10.0%) | $3 | $4 | $4 | $4 | $5 |
| Bull Case (14%) | $4 | $4 | $4 | $5 | $5 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 16.87 | 10.14 | 5.42 | 35.05 | 15.92 |
| EV/EBIT | 33.77 | 18.57 | 4.46 | 93.49 | 41.05 |
| EV/EBITDA | 7.71 | 5.00 | 1.93 | 18.90 | 7.60 |
| P/FFO | 5.57 | 4.44 | 2.29 | 11.10 | 3.85 |
| P/TBV | 7.78 | 2.81 | 0.91 | 24.58 | 11.29 |
| P/AFFO | 20.17 | 21.27 | 12.51 | 26.72 | 7.17 |
| P/B Ratio | 7.40 | 2.51 | 0.88 | 23.70 | 10.97 |
| P/S Ratio | 1.55 | 1.12 | 0.53 | 3.42 | 1.33 |
Based on our peer multiples analysis with 19 valuation metrics, the model estimates DTI's fair value at $5.49 vs the current price of $3.72, implying +47.5% upside potential. Model verdict: Significantly Undervalued. Confidence: 51/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $5.49 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $4.07 (P10) to $7.62 (P90), with a median of $5.68.
DTI's current P/E of 39.9x compares to the industry median of 23.3x (35 peers in the group). This represents a +71.4% premium to the industry. The historical average P/E is 16.9x over 3 years. Signal: High Premium.
1 analysts cover DTI with a consensus rating of Buy. The consensus price target is $6.65 (range: $4.80 — $8.50), implying +78.8% upside from the current price. Grade breakdown: Strong Buy (0), Buy (1), Hold (0), Sell (0), Strong Sell (0).
The model confidence score is 51/100, based on: data completeness (18), peer quality (25), historical depth (10), earnings stability (4), and model agreement (4). Cyclicality penalty: --10 points. The model shows moderate agreement across inputs.
The model flags several key risks: (1) Multiple compression: DTI trades at the 8290th percentile of its historical P/E range. A reversion to median (16.9×) would imply significant downside. (2) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk data is not available for DTI.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.