Frontdoor (spun off from ServiceMaster) is the parent company of four home service plan brands: American Home Shield, HSA, Landmark and OneGuard. Together, they serve more than two million customers across the U.S. through a network of 15,000 pre-qualified contractor firms that employ over 45,000 technicians. The company’s customizable home service plans help customers protect and maintain their homes from costly and unplanned breakdowns of essential home systems and appliances.
FTDR Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for FTDR, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that frontdoor inc ranked in the 25th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. The most interesting components of our discounted cash flow analysis for frontdoor inc ended up being:
The company's debt burden, as measured by earnings divided by interest payments, is 7.3 -- which is good for besting 73.99% of its peer stocks (US stocks in the Consumer Cyclical sector with positive cash flow).
The company's compound free cash flow growth rate over the past 2.02 years comes in at -0.03%; that's greater than only 21.29% of US stocks we're applying DCF forecasting to.
frontdoor inc's weighted average cost of capital (WACC) is 7%; for context, that number is higher than just 18.77% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of frontdoor inc? See OXM, BXG, KSS, NTZ, and RICK.
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