Valuing Core & Main: A Two-Stage DCF Analysis

Core & Main's estimated fair value is $49.06 based on a 2-stage free cash flow to equity model. The current share price of $52.18 suggests the company is potentially trading close to its fair value. However, our fair value estimate is 18% lower than the analyst price target of $59.75. The two-stage DCF model takes into account two stages of growth, with the first stage being a higher growth period that levels off towards the terminal value in the second 'teady growth' period.