GrubHub provides an online and mobile platform for restaurant pick-up and delivery orders in the United States. The company was founded in 1999 and is based in Chicago, Illinois.
GRUB Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for GrubHub Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that GrubHub Inc ranked in the 12th percentile in terms of potential gain offered. We should note, though, that all scenearios modelled for this stock suggest it is overvalued. As for the metrics that stood out in our discounted cash flow analysis of GrubHub Inc, consider:
The business' balance sheet reveals debt to be 11% of the company's capital (with equity being the remaining amount). Approximately merely 22.96% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
GrubHub Inc's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -2.54. This coverage rate is greater than that of only 14.6% of stocks we're observing for the purpose of forecasting via discounted cash flows.
As a business, GrubHub Inc experienced a tax rate of about 30% over the past twelve months; relative to its sector (Technology), this tax rate is higher than 85.8% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Technology that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as GRUB, try HPE, LTRPA, EVOL, MJCO, and SAP.
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