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John Wiley & Sons, Inc. (WLY) Intrinsic Value

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

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John Wiley & Sons, Inc. (WLY)

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Intrinsic Value (DCF)

Current$31.01
→
Intrinsic$31.90
+3%
$17.15$31.90$59.95
Market implies 8% growth for 5 years
WLY appears fairly valued — current price aligns with our DCF estimate.
At $31, the market prices in 8% annual cash flow growth — a moderate expectation aligned with historical trends (8%).
Range: Bear $17 → Bull $60. Current price implies expectations near the base case.
Discount ↓Growth →4%6%8%10%
8%$41$46$51$57
10%$25$28$32$36
12%$16$18$21$24
14%$10$12$15$17

Bull Case

  • Bull case ($60) offers 93% upside at 10% growth, 9% discount
  • 3% margin of safety vs. base case estimate
  • Market-implied growth (8%) ≤ historical CAGR (8%)

Bear Case

  • Bear case ($17) implies 45% downside at 6% growth, 12% discount
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5-Year Free Cash Flow Projection

Year 1$152.41M
Year 2$164.60M
Year 3$177.77M
Year 4$191.99M
Year 5$207.35M
Terminal$3.05B

📐 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$141.12MTTM 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 WLY stock undervalued or overvalued?
🟡 FAIRLY VALUED

WLY trades at $31.01, within 10% of our $31.90 intrinsic value estimate. At 10.0% WACC and 8.0% FCF growth, the market is pricing in assumptions roughly aligned with the 5-year historical CAGR. The valuation range spans $19.02 (bear) to $49.12 (bull).

What is WLY's intrinsic value?

Using a 5-year DCF model: Base FCF of $141M, 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 $813M net debt and dividing by 0.05B shares: Bear $19.02 | Base $31.90 | Bull $49.12. Current price $31.01 implies +3% to base case.

How is WLY'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 ($2.56B).

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.