Published on 20 Jun 2024 on Simply Wall St. · via Yahoo Finance
WPP plc (LON:WPP) Shares Could Be 45% Below Their Intrinsic Value Estimate
Key Insights
WPP's estimated fair value is UK£14.01 based on 2 Stage Free Cash Flow to EquityCurrent share price of UK£7.72 suggests WPP is potentially 45% undervaluedOur fair value estimate is 59% higher than WPP's analyst price target of UK£8.84
Today we'll do a simple run through of a valuation method used to estimate the attractiveness of WPP plc (LON:WPP) as an investment opportunity by taking the expected future cash flows and discounting them to their present value. This will be done using the Discounted Cash Flow (DCF) model. Believe it or not, it's not too difficult to follow, as you'll see from our example!