Deluxe Corporation provides a wide range of products and services including customized checks and forms, as well as website development and hosting, search engine marketing, search engine optimization, and logo design. The company was founded in 1915 and is based in Shoreview, Minnesota.
DLX Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for DLX, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Deluxe Corp ranked in the 34th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. The most interesting components of our discounted cash flow analysis for Deluxe Corp ended up being:
Deluxe Corp's effective tax rate, as measured by taxes paid relative to net income, is at 0 -- greater than just 0% of US stocks with positive free cash flow.
Deluxe Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -4.35. This coverage rate is greater than that of just 7.99% of stocks we're observing for the purpose of forecasting via discounted cash flows.
The weighted average cost of capital for the company is 13. This value is greater than 83.67% stocks in the Consumer Cyclical sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
HD, CRWS, ATR, BFAM, and ROST can be thought of as valuation peers to DLX, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.