I can see how you got the numbers. Please take what I say with a grain of salt.
a) A 22% growth in loan book implies they will double their loan book in about 3.2 years. Is there a chance they might not be able to grow at 22%? Maybe less than 22% or maybe more than 22%. How have you accounted for that? (and this leads me to my second point)
b) I learned this pretty late after making mistakes (meaning losing money). “Intrinsic Value” (especially looking into the future) is not a specific number, it is a range. When I was learning from my investing heroes, I heard many times that future intrinsic value is a range, but I did not understand what it really meant. It was (I believe) Bill Ackman who made me realise that the value of the business in the future can only be estimated as a range because the future is unknown. I’ll leave you with one thought “Do you think your valuation would be better off if you estimated the future value of the business as a range of outcomes?”
*You could run a mote carlo simulation – but that would be a bit too much (for anyone).
I hope you find this useful.
Regards
M
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