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Weibo Corporation (WB) Intrinsic Value

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

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Weibo Corporation (WB)

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Intrinsic Value (DCF)

Current$10.99
→
Intrinsic$39.54
+260%
$27.04$39.54$63.31
Market implies 1% growth for 5 years
DCF analysis suggests WB could have 260% upside at 8% growth — verify assumptions match your view.
At $11, the market prices in only 1% growth — below historical 8%, suggesting low expectations.
Range: Bear $27 → Bull $63. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →4%6%8%10%
8%$47$51$56$61
10%$33$36$40$43
12%$26$28$31$33
14%$21$23$25$27

Bull Case

  • Bull case ($63) offers 476% upside at 10% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (1%) ≤ historical CAGR (8%)

Bear Case

  • Bear case ($27) with 6% growth, 12% discount rate
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5-Year Free Cash Flow Projection

Year 1$624.70M
Year 2$674.68M
Year 3$728.65M
Year 4$786.95M
Year 5$849.90M
Terminal$12.51B

📐 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$578.43MTTM 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 WB stock undervalued or overvalued?
🟢 UNDERVALUED

WB trades at $10.99 vs. our DCF-derived intrinsic value of $39.54, implying +270% upside. At a 10.0% WACC and 8.0% projected FCF growth, the market appears to be underpricing the present value of WB's future cash flows. The bear case ($28.63) still suggests upside, providing margin of safety.

What is WB's intrinsic value?

Using a 5-year DCF model: Base FCF of $578M, 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 $15M net debt and dividing by 0.27B shares: Bear $28.63 | Base $39.54 | Bull $54.14. Current price $10.99 implies +270% to base case.

How is WB'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 ($10.50B).

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.