3289.TWO
INTEGRATED SERVICE TECHNOLOGY IOpen3289.TWO discounted cash flow valuation
3289.TWO Fair Value
Reverse DCF: today's price implies 48.2% a year of FCF growth for years 1–5, against 16.6% in this model.
Model: 16.6% from analyst next-year EPS & revenue growth. Fades linearly to terminal growth by year 10.
Model: 8.48% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | TWD 1.00B |
|---|---|
| PV of terminal value (64% of EV) | TWD 1.76B |
| Enterprise value | TWD 2.76B |
| + Cash & investments | TWD 672.86M |
| − Total debt | −TWD 2.17B |
| Equity value | TWD 1.27B |
| ÷ Shares outstanding | 86.75M |
| Value per share | TWD 14.60 |
| Market cap | TWD 12.14B |
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.22% |
|---|---|
| Beta (clamped 0.5–2.5) | 0.81 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 9.25% |
| Pre-tax cost of debt | 5.22% |
| Tax rate | 19.5% |
| Debt / (equity + debt) | 15.1% |
| WACC | 8.48% |
Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 6.48% | 23.78 | 27.58 | 32.34 | 38.47 | 46.64 |
| 7.48% | 16.28 | 18.73 | 21.67 | 25.26 | 29.76 |
| 8.48% | 10.96 | 12.64 | 14.60 | 16.91 | 19.69 |
| 9.48% | 7.00 | 8.20 | 9.58 | 11.16 | 13.01 |
| 10.48% | 3.94 | 4.83 | 5.84 | 6.97 | 8.28 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (TTM) | — | TWD 72.91M | — | — |
| Year 1 | 16.6% | TWD 85.02M | 0.922 | TWD 78.37M |
| Year 2 | 16.6% | TWD 99.13M | 0.850 | TWD 84.24M |
| Year 3 | 16.6% | TWD 115.58M | 0.783 | TWD 90.54M |
| Year 4 | 16.6% | TWD 134.77M | 0.722 | TWD 97.32M |
| Year 5 | 16.6% | TWD 157.14M | 0.666 | TWD 104.60M |
| Year 6 | 13.8% | TWD 178.80M | 0.614 | TWD 109.71M |
| Year 7 | 11.0% | TWD 198.39M | 0.566 | TWD 112.22M |
| Year 8 | 8.1% | TWD 214.54M | 0.521 | TWD 111.87M |
| Year 9 | 5.3% | TWD 225.95M | 0.481 | TWD 108.61M |
| Year 10 | 2.5% | TWD 231.60M | 0.443 | TWD 102.62M |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else the average of next year's EPS and revenue growth, else revenue CAGR, held between −5% and 25%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.