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VEON Ltd. (VEON) Intrinsic Value

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

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VEON Ltd. (VEON)

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Intrinsic Value (DCF)

Current$53.42
→
Intrinsic$89.62
+68%
$48.22$89.62$168.30
Market implies 1% growth for 5 years
DCF analysis suggests VEON could have 68% upside at 8% growth — verify assumptions match your view.
At $53, the market prices in only 1% growth — below historical 8%, suggesting low expectations.
Range: Bear $48 → Bull $168. Current price implies expectations below the base case, but well above the bear case.
Discount ↓Growth →4%6%8%10%
8%$114$128$143$160
10%$69$79$90$101
12%$45$52$60$68
14%$29$35$41$48

Bull Case

  • Bull case ($168) offers 215% upside at 10% growth, 9% discount
  • 40% margin of safety vs. base case estimate
  • Market-implied growth (1%) ≤ historical CAGR (8%)

Bear Case

  • Bear case ($48) implies 10% downside at 6% growth, 12% discount
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5-Year Free Cash Flow Projection

Year 1$564.84M
Year 2$610.03M
Year 3$658.83M
Year 4$711.54M
Year 5$768.46M
Terminal$11.31B

📐 Model Inputs

Growth Rate8.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$523.00MTTM 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. Regulated returns may affect assumptions. See FAQ below for full methodology.

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Frequently Asked Questions

Is VEON stock undervalued or overvalued?
🟢 UNDERVALUED

VEON trades at $53.42 vs. our DCF-derived intrinsic value of $89.62, implying +69% upside. At a 10.0% WACC and 8.0% projected FCF growth, the market appears to be underpricing the present value of VEON's future cash flows. The bear case ($53.48) still suggests upside, providing margin of safety.

What is VEON's intrinsic value?

Using a 5-year DCF model: Base FCF of $523M, projected at 8.0% 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 $3.00B net debt and dividing by 0.07B shares: Bear $53.48 | Base $89.62 | Bull $137.93. Current price $53.42 implies +69% to base case.

How is VEON's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 8.0% 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 ($9.50B).

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: 18.2x.