...

Elbit Systems Ltd. (ESLT) Intrinsic Value

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

Popular:

Elbit Systems Ltd. (ESLT)

View Full Profile →

Intrinsic Value (DCF)

Current$720.43
→
Intrinsic$127.25
-82%
$79.09$127.25$218.77
Current price reflects execution expectations above 12% growth — not unreasonable for quality businesses.
Range: Bear $79 → Bull $219. 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: $219).
Discount ↓Growth →8%10%12%14%
8%$157$173$191$209
10%$104$115$127$140
12%$75$83$92$102
14%$56$63$70$77

Bull Case

  • Bull case ($219) with 14% growth, 9% discount rate
  • Conservative 12% growth assumption is achievable based on track record

Bear Case

  • Bear case ($79) implies 89% downside at 9% growth, 12% discount
  • Trading 82% above base case — execution must exceed assumptions to justify
  • Price exceeds bull case ($219) — requires exceptional execution
Loading charts...

5-Year Free Cash Flow Projection

Year 1$357.46M
Year 2$399.86M
Year 3$447.28M
Year 4$500.33M
Year 5$559.67M
Terminal$8.24B

📐 Model Inputs

Growth Rate11.9%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$319.56MTTM 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.

Related Analysis

Full Stock ProfileCompare ESLT vs AAPLStock Screener

Frequently Asked Questions

Is ESLT stock undervalued or overvalued?
🔴 OVERVALUED

ESLT trades at $720.43 vs. our DCF-derived intrinsic value of $127.25, implying -80% downside. Using a 10.0% WACC and 11.9% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($190.26) suggests limited upside.

What is ESLT's intrinsic value?

Using a 5-year DCF model: Base FCF of $320M, projected at 11.9% 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 $1.10B net debt and dividing by 0.04B shares: Bear $81.72 | Base $127.25 | Bull $190.26. Current price $720.43 implies -80% to base case.

How is ESLT's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 11.9% 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 ($6.79B).

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: 21.3x.