Is There An Opportunity With Andritz AG’s (VIE:ANDR) 33% Undervaluation?

Source: Shutterstock Key Insights Andritz’s estimated fair value is €81.2 based on 2 Stage Free Cash Flow to Equity Current share price of €54.6 suggests Andritz is 33% undervalued How far off is Andritz AG ( VIE:ANDR ) from its intrinsic value? Using the most recent financial data, we’ll take a look at whether the stock is fairly priced by taking the forecast future cash flows of the company and discounting them back to today’s value. The Discounted Cash Flow (DCF) model is the tool we will apply to do this. It may sound complicated, but actually it is quite simple! Remember though, that there are many ways to estimate a company’s value, and a DCF is just one method. If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model . The Method We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second ‘steady growth’ period. To begin with, we have to get estimates of […]

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