Meta Platforms, Inc. (META) — DCF Valuation

Discounted Cash Flow intrinsic value with Bear, Base & Bull scenarios

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Meta Platforms, Inc. (META)

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Intrinsic Value (DCF)

Current$648.18

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Intrinsic$680.50

+5%

$418.59$680.50$1,313.25

Market implies 17% growth for 5 years

Growth 19%

Discount 8%

Terminal 3%

META appears fairly valued — current price aligns with our DCF estimate.

At $648, the market prices in continued high-teens cash flow growth (17%) — likely reflecting buybacks, margin stability, and ecosystem strength.

Range: Bear $419 → Bull $1313. Current price implies expectations near the base case.

Discount ↓Growth →	15%	17%	19%	21%
6%	$983	$1069	$1162	$1261
8%	$577	$627	$680	$738
10%	$402	$436	$473	$512
12%	$304	$330	$357	$387

Bull Case

Bull case ($1313) offers 103% upside at 22% growth, 7% discount
5% margin of safety vs. base case estimate
Market-implied growth (17%) ≤ historical CAGR (19%)

Bear Case

Bear case ($419) implies 35% downside at 15% growth, 10% discount

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5-Year Free Cash Flow Projection

Year 1$54.64B

Year 2$64.76B

Year 3$76.75B

Year 4$90.95B

Year 5$107.79B

Terminal$2.20T

📐 Model Inputs

Growth Rate18.5%5Y CAGR (cascade: 5Y→3Y→TTM)

Discount Rate8.1%WACC estimate

Terminal Growth3.0%Perpetuity rate

Base Free Cash Flow$46.11BTTM 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 META stock undervalued or overvalued?

🟡 FAIRLY VALUED

META trades at $648.18, within 10% of our $617.96 intrinsic value estimate. At 8.1% WACC and 18.5% FCF growth, the market is pricing in assumptions roughly aligned with the 5-year historical CAGR. The valuation range spans $396.00 (bear) to $982.74 (bull).

What is META's intrinsic value?

Using a 5-year DCF model: Base FCF of $46.11B, projected at 18.5% 5Y CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap), discounted at 8.1% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $48.02B net debt and dividing by 2.57B shares: Bear $396.00 | Base $617.96 | Bull $982.74. Current price $648.18 implies -6% to base case.

How is META's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 18.5% 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=8.1%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($1638.65B).

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: 35.5x.

Our Methodology

Institutional-grade research documentation

DCF Intrinsic Value Methodology

Eligibility gates, reinvestor-aware FCF normalization, WACC logic, and sensitivity analysis.

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Meta Platforms, Inc. (META) — DCF Valuation