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Grifols, S.A. (GRFS) Intrinsic Value

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

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Grifols, S.A. (GRFS)

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Intrinsic Value (DCF)

Current$8.93
→
Intrinsic$9.46
+6%
$2.18$9.46$23.28
Market implies 19% growth for 5 years
GRFS appears fairly valued — current price aligns with our DCF estimate.
At $9, the market prices in continued high-teens cash flow growth (19%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $2 → Bull $23. Current price implies expectations below the base case, but well above the bear case.
Discount ↓Growth →16%18%20%22%
8%$14$17$19$22
10%$6$8$9$11
12%$2$3$4$5
14%$0$0$1$2

Bull Case

  • Bull case ($23) offers 161% upside at 24% growth, 9% discount
  • 6% margin of safety vs. base case estimate
  • Market-implied growth (19%) ≤ historical CAGR (20%)

Bear Case

  • Bear case ($2) implies 76% downside at 16% growth, 12% discount
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5-Year Free Cash Flow Projection

Year 1$636.96M
Year 2$764.35M
Year 3$917.22M
Year 4$1.10B
Year 5$1.32B
Terminal$19.43B

📐 Model Inputs

Growth Rate20.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$530.80MTTM 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.

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Frequently Asked Questions

Is GRFS stock undervalued or overvalued?
🟡 FAIRLY VALUED

GRFS trades at $8.93, within 10% of our $9.46 intrinsic value estimate. At 10.0% WACC and 20.0% FCF growth, the market is pricing in assumptions roughly aligned with the 5-year historical CAGR. The valuation range spans $1.60 (bear) to $21.04 (bull).

What is GRFS's intrinsic value?

Using a 5-year DCF model: Base FCF of $531M, projected at 20.0% 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 $9.11B net debt and dividing by 0.68B shares: Bear $1.60 | Base $9.46 | Bull $21.04. Current price $8.93 implies +3% to base case.

How is GRFS's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 20.0% 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 ($15.54B).

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: 29.3x.