Is Ubiquiti Networks Inc (UI) overvalued?
On Equity Rank's model estimate, UI trades 45% above its fair value. Ubiquiti Networks Inc (UI) last closed at $592.84; the multi-method model fair value is $408.29.
| Price | Model fair value | Price vs model |
|---|---|---|
| $592.84 | $408.29 | 45% above |
What the answer rests on
- 0 of 10 valuation methods put UI's value above its price and 10 put it below, so the methods mostly agree.
- To justify today's price, UI's free cash flow would need to grow about 21.3% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 20.7% a year.
- UI trades at 34.4 times its last year's earnings, against a median of 35.4 for 18 profitable Technology companies.
- Over the past year the price sat below the model fair value on 0% of trading days. The gap ranged from 8% above to 35% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind UI's fair value · What prices assume · Other companies