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Medpace Holdings, Inc. (MEDP) Intrinsic Value

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

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Medpace Holdings, Inc. (MEDP)

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Intrinsic Value (DCF)

Current$618.04
→
Intrinsic$647.95
+5%
$446.34$647.95$1,030.47
Market implies 24% growth for 5 years
MEDP appears fairly valued — current price aligns with our DCF estimate.
At $618, the market prices in continued strong cash flow growth (24%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $446 → Bull $1030. Current price implies expectations near the base case.
Discount ↓Growth →21%23%25%27%
8%$794$856$923$993
10%$560$603$648$696
12%$431$462$496$532
14%$349$374$400$428

Bull Case

  • Bull case ($1030) offers 67% upside at 30% growth, 9% discount
  • 5% margin of safety vs. base case estimate
  • Market-implied growth (24%) ≤ historical CAGR (25%)

Bear Case

  • Bear case ($446) implies 28% downside at 20% growth, 12% discount
  • Using 25% growth — aggressive, watch for mean reversion
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5-Year Free Cash Flow Projection

Year 1$715.33M
Year 2$894.17M
Year 3$1.12B
Year 4$1.40B
Year 5$1.75B
Terminal$25.70B

📐 Model Inputs

Growth Rate25.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$572.27MTTM 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 MEDP stock undervalued or overvalued?
🟡 FAIRLY VALUED

MEDP trades at $618.04, within 10% of our $539.54 intrinsic value estimate. At 10.0% WACC and 25.0% FCF growth, the market is pricing in assumptions roughly aligned with the 5-year historical CAGR. The valuation range spans $359.47 (bear) to $804.72 (bull).

What is MEDP's intrinsic value?

Using a 5-year DCF model: Base FCF of $572M, projected at 25.0% 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 $-520M net debt and dividing by 0.03B shares: Bear $359.47 | Base $539.54 | Bull $804.72. Current price $618.04 implies -11% to base case.

How is MEDP's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 25.0% 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 ($16.75B).

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.