...

TransUnion (TRU) Intrinsic Value

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

Popular:

TransUnion (TRU)

View Full Profile →

Intrinsic Value (DCF)

Current$85.26
→
Intrinsic$31.29
-63%
$14.08$31.29$63.99
Market implies 29% growth for 5 years
Current price reflects execution expectations above 11% growth — not unreasonable for quality businesses.
At $85, the market prices in continued strong cash flow growth (29%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $14 → Bull $64. Current price implies expectations above the base case, closer to bull expectations.
Discount ↓Growth →7%9%11%13%
8%$42$48$54$60
10%$23$27$31$36
12%$13$16$19$22
14%$6$8$11$14

Bull Case

  • Bull case ($64) with 13% growth, 9% discount rate
  • Conservative 11% growth assumption is achievable based on track record

Bear Case

  • Bear case ($14) implies 83% downside at 9% growth, 12% discount
  • Price reflects 29% growth expectations vs 11% historical — high bar to clear
  • Trading 63% above base case — execution must exceed assumptions to justify
Loading charts...

5-Year Free Cash Flow Projection

Year 1$574.45M
Year 2$638.66M
Year 3$710.04M
Year 4$789.40M
Year 5$877.63M
Terminal$12.91B

📐 Model Inputs

Growth Rate11.2%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$516.70MTTM 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.

Related Analysis

Full Stock ProfileCompare TRU vs AAPLStock Screener

Frequently Asked Questions

Is TRU stock undervalued or overvalued?
🔴 OVERVALUED

TRU trades at $85.26 vs. our DCF-derived intrinsic value of $31.29, implying -62% downside. Using a 10.0% WACC and 11.2% FCF growth assumption, the current price requires growth rates above our estimates to be justified. Even our bull case ($53.38) suggests limited upside.

What is TRU's intrinsic value?

Using a 5-year DCF model: Base FCF of $517M, projected at 11.2% 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 $4.53B net debt and dividing by 0.20B shares: Bear $15.24 | Base $31.29 | Bull $53.38. Current price $85.26 implies -62% to base case.

How is TRU's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 11.2% 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 ($10.69B).

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: 20.7x.