I recently started practicing the DCF method for valuation on some stocks. I use the historical data about revenue, EBIT, etc. that I find on EDGAR of the company and use the changes in these values combined with the forecasts of Wall str. of the next two years (2024 and 2025) to create 3 scenarios of evolution per metric.
After completing a DCF valuation of ACI (or Albertsons Companies), the conclusion of my calculations is that the stock would be severely undervalued. The stock is at the time of writing this post priced at $ 20.11. Using my most pessimistic predictions, the stock would still be undervalued by $ 51.33.
Have I made a mistake somewhere in my calculations, or is this stock actually this undervalued?
The DCF valuation:
The WACC calculation:
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