Why we don't show a single “fair value” for EL
Even the optimistic scenario of a conservative trailing-FCF model ($33.65) sits far below today's price — the market is paying for growth and durability beyond what this model structure captures. The honest lens is the question below: what growth does today's price actually require? The model scenarios are listed further down for reference.
What would today's price require?
$93.87 is justified only if free cash flow grows about +30.6% a year (fading to 2.5% long-run) at a 10.4% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 11.4% | $17.64 |
| Base case | 2.0%/yr | 10.4% | $23.34 |
| Optimistic | 5.0%/yr | 9.4% | $33.65 |
Current Price
$93.87
Market-Implied Growth
+30.6%/yr
vs -1.5% 5Y actual
Base-Case Model Value
$23.34
model output — not a price target
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for EL (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $993.0M · 0.36B shares · net debt $4.2B
Estimated Fair Value
$23.34
-75.1% vs $93.87
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 2.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $93.87; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 8.4% | $29.68 | $32.19 | $35.14 | $38.62 | $42.80 |
| 9.4% | $24.44 | $26.28 | $28.39 | $30.82 | $33.65 |
| 10.4% | $20.38 | $21.78 | $23.34 | $25.12 | $27.15 |
| 11.4% | $17.14 | $18.23 | $19.44 | $20.78 | $22.30 |
| 12.4% | $14.50 | $15.36 | $16.32 | $17.36 | $18.53 |
