Why we don't show a single “fair value” for HNST
Even the optimistic scenario of a conservative trailing-FCF model ($1.63) 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?
$5.10 is justified only if free cash flow grows about +50.7% a year (fading to 2.5% long-run) at a 11.5% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 12.5% | $1.32 |
| Base case | 2.0%/yr | 11.5% | $1.43 |
| Optimistic | 5.0%/yr | 10.5% | $1.63 |
Current Price
$5.10
Market-Implied Growth
+50.7%/yr
vs +1.9% 5Y actual
Base-Case Model Value
$1.43
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 HNST (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 $7.3M · 0.11B shares · net cash $75.6M
Estimated Fair Value
$1.43
-72.0% vs $5.10
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 $5.10; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 9.5% | $1.55 | $1.59 | $1.64 | $1.70 | $1.76 |
| 10.5% | $1.45 | $1.48 | $1.52 | $1.56 | $1.61 |
| 11.5% | $1.37 | $1.40 | $1.43 | $1.46 | $1.50 |
| 12.5% | $1.31 | $1.33 | $1.35 | $1.38 | $1.41 |
| 13.5% | $1.26 | $1.28 | $1.29 | $1.31 | $1.34 |
