Key insights
- An economics student's DCF model suggests MDA Space is significantly overvalued, implying an 81% downside. The analysis questions the model's assumptions, the suitability of DCF for the company, or confirms the overvaluation. While the company is listed on the NYSE, the analysis is preliminary and from a student, thus having limited direct influence on the broader US equity market.
I am an Economics student right now, and I am still learning how to become proficient in building a DCF model. Anyhow, recently I've been looking at Canadian stocks, and many recommended MDA Space, which is a satellite company listed on both TSX and NYSE. The company is so popular that there is a whole subreddit dedicated to MDA Space investors at r/MDASpaceInvestors So naturally I built a DCF for the company, and turns out the DCF said that the company is significantly overvalued with an implied 81% downside. Just wants to figure out a) is there any assumptions or variables that seem bizarre in the DCF that could result in this valuation b) maybe DCF isn't the way to go with this company? or c) yes it's overvalued and overhyped.
The subreddit doesn't let me post images so the link to the Spreadsheet is here:
Thanks!