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Manhattan Associates, Inc. (MANH) Intrinsic Value

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

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Manhattan Associates, Inc. (MANH)

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Intrinsic Value (DCF)

Current$175.57
→
Intrinsic$146.80
-16%
$101.12$146.80$233.51
Market implies 26% growth for 5 years
MANH trades at a premium to our conservative estimate — investors expect above-average performance.
At $176, the market prices in continued strong cash flow growth (26%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $101 → Bull $234. Current price implies expectations above the base case, closer to bull expectations.
Discount ↓Growth →18%20%22%24%
8%$179$193$209$225
10%$126$136$147$158
12%$97$105$113$121
14%$79$85$91$98

Bull Case

  • Bull case ($234) offers 33% upside at 26% growth, 9% discount

Bear Case

  • Bear case ($101) implies 42% downside at 17% growth, 12% discount
  • Price reflects 26% growth expectations vs 22% historical — high bar to clear
  • Trading 16% above base case — execution must exceed assumptions to justify
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5-Year Free Cash Flow Projection

Year 1$348.19M
Year 2$423.41M
Year 3$514.88M
Year 4$626.11M
Year 5$761.37M
Terminal$11.20B

📐 Model Inputs

Growth Rate21.6%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$286.33MTTM 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 MANH stock undervalued or overvalued?
🔴 OVERVALUED

MANH trades at $175.57 vs. our DCF-derived intrinsic value of $138.31, implying -18% downside. Using a 10.0% WACC and 21.6% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($206.62) suggests limited upside.

What is MANH's intrinsic value?

Using a 5-year DCF model: Base FCF of $286M, projected at 21.6% 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 $-218M net debt and dividing by 0.06B shares: Bear $91.93 | Base $138.31 | Bull $206.62. Current price $175.57 implies -18% to base case.

How is MANH's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 21.6% 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 ($8.38B).

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.