Complete GTES Stock Valuation Analysis
Comprehensive intrinsic value analysis using 5 different methodologies
GTES DCF Analysis
GTES (Gates Industrial Corporation plc) discounted cash flow analysis with multiple scenarios, growth assumptions, and terminal value calculations
Financial Projections
| Metrics | 2022 (Historical) | 2023 (Historical) | 2024 (Historical) | 2025 (Projected) | 2026 (Projected) | 2027 (Projected) | 2028 (Projected) | 2029 (Projected) |
|---|---|---|---|---|---|---|---|---|
| Revenue | $3.6B | $3.6B | $3.4B | $3.4B | $3.5B | $3.5B | $3.6B | $3.6B |
| Revenue Growth % | - | 0.5% | -4.5% | 1.2% | 1.1% | 1.0% | 0.9% | 0.8% |
| EBIT | $384.0M | $462.6M | $478.7M | $434.7M | $443.0M | $450.9M | $458.5M | $465.7M |
| EBIT Margin % | 10.8% | 13.0% | 14.0% | 12.6% | 12.7% | 12.8% | 12.9% | 13.0% |
| Tax Rate % | 5.8% | 9.9% | 32.8% | 10.7% | 12.2% | 13.6% | 15.0% | 16.4% |
| NOPAT | $361.8M | $416.7M | $321.8M | $388.0M | $389.1M | $389.6M | $389.6M | $389.1M |
| NOPAT Margin % | 10.2% | 11.7% | 9.4% | 11.2% | 11.2% | 11.1% | 11.0% | 10.9% |
| Capex | $87.0M | $61.2M | $83.1M | $79.5M | $76.3M | $73.2M | $70.2M | $67.2M |
| Capex / Revenue % | 2.4% | 1.7% | 2.4% | 2.3% | 2.2% | 2.1% | 2.0% | 1.9% |
| Depreciation | $217.2M | $217.5M | $216.9M | $213.5M | $215.9M | $218.0M | $219.9M | $221.7M |
| D&A / Revenue % | 6.1% | 6.1% | 6.4% | 6.2% | 6.2% | 6.2% | 6.2% | 6.2% |
| Change in NWC | $102.3M | $96.9M | $-37.5M | $79.1M | $64.0M | $51.7M | $41.7M | $33.7M |
| NWC Change / Revenue % | 2.9% | 2.7% | -1.1% | 2.3% | 1.8% | 1.5% | 1.2% | 0.9% |
| Unlevered FCF | $389.7M | $476.1M | $493.1M | $442.9M | $464.6M | $482.6M | $497.6M | $509.9M |
| UFCF % Chg. | - | 22.2% | 3.6% | -10.2% | 4.9% | 3.9% | 3.1% | 2.5% |
| FCF / Revenue % | 11.0% | 13.3% | 14.5% | 12.8% | 13.3% | 13.7% | 14.0% | 14.2% |
| Discount Factor | - | - | - | 0.923 | 0.852 | 0.786 | 0.725 | 0.669 |
| Present Value of FCF | - | - | - | $408.7M | $395.6M | $379.3M | $360.8M | $341.2M |
| Sum of PV of UFCF | - | - | - | $408.7M | $804.3M | $1.2B | $1.5B | $1.9B |
WACC Calculation
Weighted Average Cost of Capital used for discounting cash flows.
| WACC Calculation | Value |
|---|---|
| Cost of Debt | 6.2% |
| Tax Rate | 10.7% |
| After Tax Cost of Debt | 5.6% |
| Risk Free Rate | 4.24% |
| Market Risk Premium | 4.3% |
| Beta | 1.22 |
| Cost of Equity | 9.5% |
| Total Debt | $2.5B |
| Market Cap | $6.0B |
| Total Capital | $8.5B |
| Debt Weighting | 29.2% |
| Equity Weighting | 70.8% |
| WACC | 8.4% |
Terminal Value
Choose between perpetuity growth or exit multiple methods.
| Terminal Value Calculation | Value |
|---|---|
| Terminal Growth Rate | 2.5% |
| Final Year FCF | $509.9M |
| Terminal Value | $8.9B |
| PV of Terminal Value | $6.0B |
| Cumulative PV of UFCF | $1.9B |
| Net Debt | $1.8B |
| Equity Value | $6.1B |
| Shares Outstanding | 263.4M |
| Implied Share Price | $23 |
| Current Share Price | $23 |
| Implied Upside/(Downside) | -1.7% |
Valuation Summary
$22.97
Implied Price
$23.36
Current Price
-1.7%
Upside/Downside
8.4%
WACC
GTES Peer Valuation Analysis
Relative valuation based on comparable company trading multiples
Peer Valuation Analysis
Fair Value Range Analysis
Based on median multiples from 11 peer companies in Industrials
P/E Ratio
$23.36
+0.0%
Peer Median: 28.0x
EV/EBITDA
$40.67
+74.1%
Peer Median: 17.6x
P/S Ratio
$36.46
+56.1%
Peer Median: 2.8x
Interpretation: Each multiple provides a different perspective on fair value. Consider which multiple is most relevant for GTES's business model and current situation.
Multiple Comparison
| Multiple | GTES Current | Peer Median | Peer Average | Premium/Discount | Assessment |
|---|---|---|---|---|---|
| P/E Ratio | 28.0x | 28.0x | 29.1x | 0.0% | Fair Value |
| EV/EBITDA | 13.1x | 17.6x | 17.2x | -25.4% | Undervalued |
| P/S Ratio | 1.8x | 2.8x | 2.9x | -35.9% | Undervalued |
Peer Companies
Click any company to view their valuation
| Company | Market Cap | P/E Ratio | EV/EBITDA | P/S Ratio |
|---|---|---|---|---|
| $7.56B | 27.7x | 17.6x | 2.8x | |
| $7.33B | 28.7x | 11.8x | 1.7x | |
| $7.94B | 39.6x | 21.9x | 4.0x | |
| $6.84B | 24.6x | 14.0x | 1.5x | |
| $6.41B | 0.0x | 56.0x | 2.9x | |
| $6.02B | 28.0x | 13.1x | 1.8x | |
| $10.99B | 33.2x | 25.7x | 5.2x | |
| $5.33B | 16.4x | 9.6x | 1.2x | |
| $4.92B | 41.7x | 24.5x | 4.6x | |
| $4.20B | 23.9x | 15.0x | 2.1x | |
| $90.01B | 27.1x | 18.7x | 4.5x |
GTES Graham Number
Benjamin Graham's conservative valuation formula for defensive investors
Input Data
| EPS (TTM) | $0.83 | Latest 10-K |
| Book Value per Share | $11.48 | Latest 10-K Balance Sheet |
| Graham Constant | 22.5 | Benjamin Graham's formula |
Graham Number Result
$14.68
Intrinsic Value
$23.36
Current Price
-37.1%
Upside/Downside
Confidence: High
Conservative value investing approach
Calculation Breakdown
Formula:
√(22.5 × EPS × BVPS)
Step 1: Multiply constant by EPS
22.5 × 0.83 = 18.78
Step 2: Multiply by Book Value per Share
18.78 × 11.48 = 215.59
Step 3: Take square root
√215.59 = 14.68
Graham Number Result:
$14.68
GTES Graham Intrinsic Value
Growth-adjusted intrinsic value with two formula variants
Formula Selection
V = EPS × (8.5 + 2g)
Graham's original P/E shortcut for growth, no interest-rate adjustment
V = [EPS × (8.5 + 2g) × 4.4] / Y
Graham's 1974 refinement: adds rate-environment sensitivity
Active Formula: Base-Growth
0.83 × (8.5 + 2 × 8.0%)
Input Data & Growth Assumptions
Current EPS (TTM)$0.83
Latest 10-K • 2024-12-28T00:00:00
No positive historical growth rates available.
Graham's formula is designed for growing companies. Use the custom input below with a conservative positive growth estimate (5-10%).
Custom
%
Enter a positive growth rate estimate (0-50%)
Graham Intrinsic Value Result
$20.45
Intrinsic Value
$23.36
Current Price
-12.5%
Upside/Downside
Base Formula
Growth: 8.0%
GTES Earnings Power Value (EPV)
Normalized earnings-based valuation for sustainable earning power assessment
Earnings Normalization
| Earnings Component | Amount ($B) | Description |
|---|---|---|
| Reported Earnings | 0.2 | Base earnings from financial statements |
| Normalized Earnings | 0.2 | Final normalized earning power |
One-time Items: Remove non-recurring gains/losses
Cyclical Adjustment: Normalize for economic cycle position
EPV Result
$9.97
EPV per Share
$23.36
Current Price
-57.3%
Upside/Downside
7.4%
WACC: 7.4% (calculated from market data)
Confidence: High
Normalized earnings approach
EPV Calculation Breakdown
Enterprise Value Calculation
| Normalized Earnings | $0.2B |
| Cost of Capital | 7.4% |
| Enterprise Value | $2.6B |
Per Share Value
| Enterprise Value | $2.6B |
| Shares Outstanding | 0.3B |
| EPV per Share | $9.97 |
WACC Components
| Cost of Equity | 9.0% |
| After-Tax Cost of Debt | 3.5% |
| Equity Weight | 71.3% |
| Debt Weight | 28.7% |
| WACC | 7.4% |