IGO.AX
IGOLIMITED FPO [IGO]Pre-marketIGO.AX discounted cash flow valuation
IGO.AX Fair Value
Reverse DCF: today's price implies 12.4% a year of FCF growth for years 1–5, against -5.0% in this model.
Model: -5.0% from analyst next-year EPS & revenue growth (capped). Fades linearly to terminal growth by year 10.
Model: 8.60% (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 | AUD 673.14M |
|---|---|
| PV of terminal value (51% of EV) | AUD 701.03M |
| Enterprise value | AUD 1.37B |
| + Cash & investments | AUD 485.60M |
| − Total debt | −AUD 16.80M |
| Equity value | AUD 1.84B |
| ÷ Shares outstanding | 757.27M |
| Value per share | AUD 2.43 |
| Market cap | AUD 4.17B |
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.22% |
|---|---|
| Beta (clamped 0.5–2.5) | 0.68 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 8.60% |
| Pre-tax cost of debt | 12.00% |
| Tax rate | 30.0% |
| Debt / (equity + debt) | 0.4% |
| WACC | 8.60% |
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% |
|---|---|---|---|---|---|
| 6.60% | 2.86 | 3.04 | 3.25 | 3.52 | 3.88 |
| 7.60% | 2.52 | 2.63 | 2.76 | 2.92 | 3.12 |
| 8.60% | 2.27 | 2.34 | 2.43 | 2.54 | 2.66 |
| 9.60% | 2.08 | 2.13 | 2.20 | 2.27 | 2.35 |
| 10.60% | 1.93 | 1.97 | 2.02 | 2.07 | 2.13 |
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 (FY2026) | — | AUD 126.30M | — | — |
| Year 1 | -5.0% | AUD 119.98M | 0.921 | AUD 110.48M |
| Year 2 | -5.0% | AUD 113.99M | 0.848 | AUD 96.65M |
| Year 3 | -5.0% | AUD 108.29M | 0.781 | AUD 84.54M |
| Year 4 | -5.0% | AUD 102.87M | 0.719 | AUD 73.96M |
| Year 5 | -5.0% | AUD 97.73M | 0.662 | AUD 64.70M |
| Year 6 | -3.5% | AUD 94.31M | 0.610 | AUD 57.49M |
| Year 7 | -2.0% | AUD 92.42M | 0.561 | AUD 51.88M |
| Year 8 | -0.5% | AUD 91.96M | 0.517 | AUD 47.53M |
| Year 9 | 1.0% | AUD 92.88M | 0.476 | AUD 44.20M |
| Year 10 | 2.5% | AUD 95.20M | 0.438 | AUD 41.72M |
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.