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Insulet Corporation (PODD) Intrinsic Value

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

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Insulet Corporation (PODD)

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Intrinsic Value (DCF)

Current$286.49
→
Intrinsic$139.72
-51%
$93.11$139.72$228.17
Current price reflects execution expectations above 25% growth — not unreasonable for quality businesses.
Range: Bear $93 → Bull $228. Current price implies expectations above the base case, closer to bull expectations.
Current price reflects assumptions at the upper end of our valuation range (bull case: $228).
Discount ↓Growth →21%23%25%27%
8%$173$188$203$220
10%$119$129$140$151
12%$89$97$105$113
14%$71$76$82$89

Bull Case

  • Bull case ($228) with 30% growth, 9% discount rate

Bear Case

  • Bear case ($93) implies 68% downside at 20% growth, 12% discount
  • Trading 51% above base case — execution must exceed assumptions to justify
  • Price exceeds bull case ($228) — requires exceptional execution
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5-Year Free Cash Flow Projection

Year 1$381.75M
Year 2$477.19M
Year 3$596.48M
Year 4$745.61M
Year 5$932.01M
Terminal$13.71B

📐 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$305.40MTTM 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 PODD stock undervalued or overvalued?
🔴 OVERVALUED

PODD trades at $286.49 vs. our DCF-derived intrinsic value of $114.66, implying -61% downside. Using a 10.0% WACC and 25.0% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($175.97) suggests limited upside.

What is PODD's intrinsic value?

Using a 5-year DCF model: Base FCF of $305M, 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 $469M net debt and dividing by 0.07B shares: Bear $73.02 | Base $114.66 | Bull $175.97. Current price $286.49 implies -61% to base case.

How is PODD'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 ($8.94B).

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.