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Globe Life Inc. (GL) Intrinsic Value

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

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Globe Life Inc. (GL)

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Intrinsic Value (DCF)

Current$141.93
→
Intrinsic$237.80
+68%
$152.81$237.80$399.31
Market implies 1% growth for 5 years
DCF analysis suggests GL could have 68% upside at 12% growth — verify assumptions match your view.
At $142, the market prices in only 1% growth — below historical 12%, suggesting low expectations.
Range: Bear $153 → Bull $399. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →8%10%12%14%
8%$291$319$349$382
10%$197$217$238$260
12%$146$160$176$193
14%$113$124$137$150

Bull Case

  • Bull case ($399) offers 181% upside at 14% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (1%) ≤ historical CAGR (12%)

Bear Case

  • Bear case ($153) with 9% growth, 12% discount rate
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5-Year Net Income Projection

Year 1$1.20B
Year 2$1.34B
Year 3$1.50B
Year 4$1.67B
Year 5$1.87B
Terminal$27.54B

📐 Model Inputs

Growth Rate11.8%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Net Income$1.07BTTM 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. Uses Net Income (FCF not meaningful for insurers). See FAQ below for full methodology.

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Frequently Asked Questions

Is GL stock undervalued or overvalued?
🟢 UNDERVALUED

GL trades at $141.93 vs. our DCF-derived intrinsic value of $237.80, implying +70% upside. At a 10.0% WACC and 11.8% projected FCF growth, the market appears to be underpricing the present value of GL's future cash flows. The bear case ($157.52) still suggests upside, providing margin of safety.

What is GL's intrinsic value?

Using a 5-year DCF model: Base FCF of $1.07B, projected at 11.8% 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 $2.57B net debt and dividing by 0.08B shares: Bear $157.52 | Base $237.80 | Bull $348.86. Current price $141.93 implies +70% to base case.

How is GL's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 11.8% 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 ($22.73B).

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: 21.2x.