Leonardo DRS Valuation

Q: What is the Fair Price of DRS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

DRS (₪70.39) is trading below our estimate of [[fair value]] (₪88.21)

Is DRS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of DRS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: DRS (₪70.39) is trading below our estimate of fair value (₪88.21)

Significantly Below Fair Value: DRS is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for DRS?

Key metric: As DRS is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for DRS. This is calculated by dividing DRS's market cap by their current earnings.
What is DRS's PE Ratio?
PE Ratio	34.2x
Earnings	US$168.00m
Market Cap	US$5.75b

DRS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2x
Enterprise Value/EBITDA	17.7x
PEG Ratio	2.2x

Price to Earnings Ratio vs Peers

How does DRS's PE Ratio compare to its peers?

The above table shows the PE ratio for DRS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PE	Estimated Growth	Market Cap
Peer Average	34x
ESLT Elbit Systems	42.6x	14.5%	₪41.2b
BSEN Bet Shemesh Engines Holdings (1997)	11.7x	n/a	₪3.1b
ISHI Israel Shipyards Industries	28.6x	n/a	₪1.8b
ASHO Ashot Ashkelon Industries	53.3x	n/a	₪1.2b
DRS Leonardo DRS	34.2x	15.6%	₪5.7b

Price-To-Earnings vs Peers: DRS is expensive based on its Price-To-Earnings Ratio (34.2x) compared to the peer average (17.8x).

Price to Earnings Ratio vs Industry

How does DRS's PE Ratio compare vs other companies in the Asian Aerospace & Defense Industry?

1 Company	Price / Earnings	Estimated Growth	Market Cap

1 Company		Estimated Growth	Market Cap

No more companies

Price-To-Earnings vs Industry: DRS is good value based on its Price-To-Earnings Ratio (34.2x) compared to the Asian Aerospace & Defense industry average (41.7x).

Price to Earnings Ratio vs Fair Ratio

What is DRS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

DRS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	34.2x
Fair PE Ratio	27.5x

Price-To-Earnings vs Fair Ratio: DRS is expensive based on its Price-To-Earnings Ratio (34.2x) compared to the estimated Fair Price-To-Earnings Ratio (27.5x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.

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