MeritValue

DNOW Inc.

DNOWdata completeness 100%14 fiscal years on file

Data notes: no data for concept 'interestExpense'

The thesis, from the filings

DNOW Inc. earns about 9% on invested capital, barely covering its ~9% cost of capital, but has diluted owners by 7% over 5 years — worth asking whether the growth reaches owners. The estimate methods put fair value between $6.86 and $84.42 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$1.63B1$2.14B2$2.32B3$2.37B3$2.82B3
Net income$5M4$128M5$250M6$78M6−$89M6
Operating cash flow$30M7$08$188M9$298M9$155M9
Capital expenditure$5M10$9M11$17M12$9M12$21M12
Free cash flow (derived)$25M7−$9M8$171M9$289M9$134M9
Total debt———$013$411M13
Cash & equivalents$313M14$212M15$299M16$256M17$164M17
Diluted shares110.5M111.2M108.4M107.1M117.9M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$189.43
your share of equity
Profit it earned you last year
−$7.55
Free cash flow it threw off
$11.37
Debt you’d be carrying
$34.87

10 shares is a claim on $189.43 of net worth that earned you −$7.55 and generated $11.37 of cash last year, against $34.87 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
9% avg · 5y
FY21 2%FY22 20%FY23 19%FY24 9%FY25 -3%

It earned about 9% on invested capital against a ~9% cost of capital — roughly what it costs to fund the business, so the numbers show no clear edge.

seeing a moat in the numbers →
Management signal · capital allocation
+7% shares · 5y

Share count is up 7% over 5 years — owners have been diluted. Worth asking what they got for it.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $6.86 and $84.42 a share. They rest on different assumptions, so where they diverge is the story.

DCF · Growth Exit 10Y
$84.42
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth20.0%
  • fcfBase$171M
DCF · Growth Exit 5Y
$45.2
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth20.0%
  • fcfBase$171M
Earnings Power Value
$6.86
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$78M
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years20.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $45.2
The three cases
Bear0.0%$18.63
Base20.0%$45.2
Bull20.0%$45.2

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 20.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000950170-24-015744 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000950170-25-021784 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001193125-26-072828 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000950170-24-015744 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000950170-25-021784 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001193125-26-072828 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000950170-24-015744 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000950170-25-021784 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001193125-26-072828 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000950170-24-015744 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000950170-25-021784 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001193125-26-072828 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2024-12-31 · accession 0001193125-26-072828 (LongTermDebt)
  14. 10-K · period ending 2021-12-31 · accession 0000950170-23-002996 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2022-12-31 · accession 0000950170-24-015744 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2023-12-31 · accession 0000950170-25-021784 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2024-12-31 · accession 0001193125-26-072828 (CashAndCashEquivalentsAtCarryingValue)