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ESAB Corporation (ESAB)
Intrinsic Value (DCF)
Current$121.81
→
Intrinsic$76.76
-37%
$47.79$76.76$131.84
Market implies 18% growth for 5 years
Current price reflects execution expectations above 8% growth — not unreasonable for quality businesses.
At $122, the market prices in continued high-teens cash flow growth (18%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $48 → Bull $132. Current price implies expectations above the base case, closer to bull expectations.
| Discount ↓Growth → | 4% | 6% | 8% | 10% |
|---|---|---|---|---|
| 8% | $94 | $104 | $114 | $126 |
| 10% | $63 | $69 | $77 | $85 |
| 12% | $45 | $50 | $56 | $62 |
| 14% | $34 | $38 | $43 | $47 |
Bull Case
- Bull case ($132) offers 8% upside at 10% growth, 9% discount
- Conservative 8% growth assumption is achievable based on track record
Bear Case
- Bear case ($48) implies 61% downside at 7% growth, 12% discount
- Price reflects 18% growth expectations vs 8% historical — high bar to clear
- Trading 37% above base case — execution must exceed assumptions to justify
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5-Year Free Cash Flow Projection
Year 1$329.11M
Year 2$356.75M
Year 3$386.71M
Year 4$419.18M
Year 5$454.38M
Terminal$6.69B
📐 Model Inputs
Growth Rate8.4%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$303.62MTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.