General Mills, Inc. (GIS) Intrinsic Value

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

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General Mills, Inc. (GIS)

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Intrinsic Value (DCF)

Current$45.60
Intrinsic$47.90
+5%
$24.32$47.90$92.72
Market implies 7% growth for 5 years
GIS appears fairly valued — current price aligns with our DCF estimate.
At $46, the market prices in only 7% growth — below historical 8%, suggesting low expectations.
Range: Bear $24 → Bull $93. Current price implies expectations near the base case.
Discount ↓Growth →4%6%8%10%
8%$62$70$79$88
10%$36$42$48$54
12%$22$26$31$36
14%$13$17$20$24

Bull Case

  • Bull case ($93) offers 103% upside at 10% growth, 9% discount
  • 5% margin of safety vs. base case estimate
  • Market-implied growth (7%) ≤ historical CAGR (8%)

Bear Case

  • Bear case ($24) implies 47% downside at 6% growth, 12% discount
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5-Year Free Cash Flow Projection

Year 1$2.48B
Year 2$2.67B
Year 3$2.89B
Year 4$3.12B
Year 5$3.37B
Terminal$49.57B

📐 Model Inputs

Growth Rate8.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$2.29BTTM 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.

Frequently Asked Questions

Is GIS stock undervalued or overvalued?
🟡 FAIRLY VALUED

GIS trades at $45.60, within 10% of our $47.90 intrinsic value estimate. At 10.0% WACC and 8.0% FCF growth, the market is pricing in assumptions roughly aligned with the 5-year historical CAGR. The valuation range spans $27.31 (bear) to $75.42 (bull).

What is GIS's intrinsic value?

Using a 5-year DCF model: Base FCF of $2.29B, projected at 8.0% 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 $14.93B net debt and dividing by 0.56B shares: Bear $27.31 | Base $47.90 | Bull $75.42. Current price $45.60 implies +9% to base case.

How is GIS's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 8.0% 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 ($41.63B).

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.