MeritValue

IPG PHOTONICS CORP

IPGPdata completeness 88%17 fiscal years on file
The thesis, from the filings

IPG PHOTONICS CORP earns about 5% on invested capital, below its ~9% cost of capital, and has bought back 21% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $26.7 and $59.51 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$1.46B1$1.43B2$1.29B3$977.1M3$1B3
Net income$278.4M4$109.9M5$218.9M6−$181.5M6$31.1M6
Operating cash flow$389.7M7$212.6M8$296M9$247.9M9$75.3M9
Capital expenditure$123.1M10$110.1M11$110.5M12$98.5M12$78.8M12
Free cash flow (derived)$266.6M7$102.5M8$185.5M9$149.4M9−$3.45M9
Total debt$68.3M13$32.1M13$014——
Cash & equivalents$709.1M15$698.2M16$514.7M17$620M18$403.8M18
Diluted shares53.9M50.9M47.3M44.3M42.6M

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
$498.98
your share of equity
Profit it earned you last year
$7.29
Free cash flow it threw off
−$0.81
Debt you’d be carrying
—

10 shares is a claim on $498.98 of net worth that earned you $7.29 and generated −$0.81 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
5% avg · 5y
FY21 13%FY22 6%FY23 12%FY24 -9%FY25 2%

It earned about 5% 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
−21% shares · 5y

Share count is down 21% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has fallen 100% — deleveraging.

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 $26.7 and $59.51 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
$55.74
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$149.4M
DCF · Growth Exit 5Y
$59.51
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$149.4M
Earnings Power Value
$26.7
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$109.9M
  • growthAssumed0.0%
Graham Number
$28.63
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 years0.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $59.51
The three cases
Bear0.0%$59.51
Base0.0%$59.51
Bull5.0%$71.62

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

Default growth 0.0%= 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 0001111928-24-000019 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001111928-25-000023 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001111928-26-000040 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001111928-24-000019 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001111928-25-000023 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001111928-26-000040 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001111928-24-000019 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001111928-25-000023 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001111928-26-000040 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001111928-24-000019 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001111928-25-000023 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001111928-26-000040 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001111928-23-000039 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2023-12-31 · accession 0001111928-24-000019 (LongTermDebtCurrent)
  15. 10-K · period ending 2021-12-31 · accession 0001111928-23-000039 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2022-12-31 · accession 0001111928-24-000019 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2023-12-31 · accession 0001111928-25-000023 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2024-12-31 · accession 0001111928-26-000040 (CashAndCashEquivalentsAtCarryingValue)