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NICE Ltd. (NICE) Intrinsic Value

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

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NICE Ltd. (NICE)

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Intrinsic Value (DCF)

Current$115.47
→
Intrinsic$309.24
+168%
$210.39$309.24$496.95
Market implies 1% growth for 5 years
DCF analysis suggests NICE could have 168% upside at 19% growth — verify assumptions match your view.
At $115, the market prices in only 1% growth — below historical 19%, suggesting low expectations.
Range: Bear $210 → Bull $497. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →15%17%19%21%
8%$376$408$442$478
10%$264$286$309$334
12%$202$219$236$254
14%$163$176$190$204

Bull Case

  • Bull case ($497) offers 330% upside at 22% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (1%) ≤ historical CAGR (19%)

Bear Case

  • Bear case ($210) with 15% growth, 12% discount rate
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5-Year Free Cash Flow Projection

Year 1$869.27M
Year 2$1.03B
Year 3$1.22B
Year 4$1.45B
Year 5$1.72B
Terminal$25.32B

📐 Model Inputs

Growth Rate18.6%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$732.87MTTM 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 NICE stock undervalued or overvalued?
🟢 UNDERVALUED

NICE trades at $115.47 vs. our DCF-derived intrinsic value of $309.24, implying +163% upside. At a 10.0% WACC and 18.6% projected FCF growth, the market appears to be underpricing the present value of NICE's future cash flows. The bear case ($204.59) still suggests upside, providing margin of safety.

What is NICE's intrinsic value?

Using a 5-year DCF model: Base FCF of $733M, projected at 18.6% 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 $82M net debt and dividing by 0.07B shares: Bear $204.59 | Base $309.24 | Bull $461.84. Current price $115.47 implies +163% to base case.

How is NICE's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 18.6% 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 ($20.34B).

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: 27.8x.