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SiriusPoint Ltd. (SPNT) Intrinsic Value

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

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SiriusPoint Ltd. (SPNT)

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Intrinsic Value (DCF)

Current$20.40
→
Intrinsic$37.10
+82%
$25.35$37.10$59.39
Market implies 7% growth for 5 years
DCF analysis suggests SPNT could have 82% upside at 22% growth — verify assumptions match your view.
At $20, the market prices in only 7% growth — below historical 22%, suggesting low expectations.
Range: Bear $25 → Bull $59. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →18%20%22%24%
8%$45$49$53$57
10%$32$34$37$40
12%$24$26$28$30
14%$20$21$23$24

Bull Case

  • Bull case ($59) offers 191% upside at 26% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (7%) ≤ historical CAGR (22%)

Bear Case

  • Bear case ($25) with 17% growth, 12% discount rate
  • Using 22% growth — aggressive, watch for mean reversion
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5-Year Net Income Projection

Year 1$243.28M
Year 2$296.08M
Year 3$360.34M
Year 4$438.54M
Year 5$533.71M
Terminal$7.85B

📐 Model Inputs

Growth Rate21.7%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Net Income$199.90MTTM 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. Uses Net Income (FCF not meaningful for insurers). See FAQ below for full methodology.

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Frequently Asked Questions

Is SPNT stock undervalued or overvalued?
🟢 UNDERVALUED

SPNT trades at $20.40 vs. our DCF-derived intrinsic value of $34.78, implying +70% upside. At a 10.0% WACC and 21.7% projected FCF growth, the market appears to be underpricing the present value of SPNT's future cash flows. The bear case ($22.90) still suggests upside, providing margin of safety.

What is SPNT's intrinsic value?

Using a 5-year DCF model: Base FCF of $200M, projected at 21.7% 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 $-43M net debt and dividing by 0.17B shares: Bear $22.90 | Base $34.78 | Bull $52.28. Current price $20.40 implies +70% to base case.

How is SPNT's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 21.7% 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 ($5.85B).

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.