MeritValue

ESCO TECHNOLOGIES INC

ESEdata completeness 100%18 fiscal years on file
The thesis, from the filings

ESCO TECHNOLOGIES INC earns about 7% on invested capital, below its ~9% cost of capital, with a roughly flat share count — no moat visible in the numbers. The estimate methods put fair value between $37.01 and $45.9 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$715.4M1$857.5M2$855.8M3$919.1M3$1.1B3
Net income$63.5M4$82.3M5$92.5M6$101.9M6$299.2M6
Operating cash flow$123.1M7$135.3M8$76.9M9$127.5M9$241.9M9
Capital expenditure$26.7M10$32.1M11$19.7M12$28.3M12$36.3M12
Free cash flow (derived)$96.4M7$103.2M8$57.2M9$99.3M9$205.6M9
Total debt$328M13$326M14$224M15$264M16$392M16
Cash & equivalents$56.2M17$97.7M18$41.9M19$66M20$101.4M20
Diluted shares26.2M26.1M25.9M25.9M25.9M

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
$594.7
your share of equity
Profit it earned you last year
$115.49
Free cash flow it threw off
$79.36
Debt you’d be carrying
$151.29

10 shares is a claim on $594.7 of net worth that earned you $115.49 and generated $79.36 of cash last year, against $151.29 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
7% avg · 5y
FY21 5%FY22 7%FY23 7%FY24 8%FY25 7%

It earned about 7% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−1% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback. Total debt has risen 20% over the same window.

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 $37.01 and $45.9 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$43.21
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth1.0%
  • fcfBase$99.3M
DCF · Growth Exit 5Y
$45.9
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth1.0%
  • fcfBase$99.3M
Earnings Power Value
$37.01
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$92.5M
  • growthAssumed0.0%
Graham Number
$124.32
assumptions (1)
  • grahamMultiplier2250.0%

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 years1.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $45.9
The three cases
Bear0.0%$43.52
Base1.0%$45.9
Bull6.0%$59.63

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

Default growth 1.0%= 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 2021-09-30 · accession 0001410578-23-002596 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-09-30 · accession 0001410578-24-002064 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-09-30 · accession 0001104659-25-117276 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-09-30 · accession 0001410578-23-002596 (NetIncomeLoss)
  5. 10-K · period ending 2022-09-30 · accession 0001410578-24-002064 (NetIncomeLoss)
  6. 10-K · period ending 2023-09-30 · accession 0001104659-25-117276 (NetIncomeLoss)
  7. 10-K · period ending 2021-09-30 · accession 0001410578-23-002596 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-09-30 · accession 0001410578-24-002064 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-09-30 · accession 0001104659-25-117276 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-09-30 · accession 0001410578-23-002596 (PaymentsToAcquireProductiveAssets)
  11. 10-K · period ending 2022-09-30 · accession 0001410578-24-002064 (PaymentsToAcquireProductiveAssets)
  12. 10-K · period ending 2023-09-30 · accession 0001104659-25-117276 (PaymentsToAcquireProductiveAssets)
  13. 10-K · period ending 2021-09-30 · accession 0001410578-22-003540 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-09-30 · accession 0001410578-23-002596 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-09-30 · accession 0001410578-24-002064 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-09-30 · accession 0001104659-25-117276 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-09-30 · accession 0001410578-22-003540 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-09-30 · accession 0001410578-23-002596 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-09-30 · accession 0001410578-24-002064 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-09-30 · accession 0001104659-25-117276 (CashAndCashEquivalentsAtCarryingValue)