MeritValue

Stagwell Inc

STGWdata completeness 100%17 fiscal years on file
The thesis, from the filings

Stagwell Inc earns about 1% on invested capital, but has diluted owners by 193% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $0.78 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$1.47B1$2.69B2$2.53B3$2.84B3$2.91B3
Net income$21M4$19.9M5$134,0006$2.26M6$29.1M6
Operating cash flow$200.9M7$347.6M8$81M9$142.9M9$291M9
Capital expenditure$8.8M10$22.7M11$14.2M12$18.9M12$43.7M12
Free cash flow (derived)$192.1M7$324.9M8$66.8M9$123.9M9$247.3M9
Total debt$2.38B13$2.37B14$2.29B15$2.71B16$2.65B16
Cash & equivalents$184M17$220.6M18$119.7M19$131.3M20$104.5M20
Diluted shares90.4M296.6M122.2M115.8M264.5M

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
$28.67
your share of equity
Profit it earned you last year
$1.1
Free cash flow it threw off
$9.35
Debt you’d be carrying
$100.26

10 shares is a claim on $28.67 of net worth that earned you $1.1 and generated $9.35 of cash last year, against $100.26 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
1% avg · 5y
FY21 1%FY22 2%FY23 2%FY24 1%FY25 1%

It earned an average 1% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+193% shares · 5y

Share count is up 193% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 11% 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
DCF · Growth Exit 10Y
not applicable
negative equity value — refusing to publish per-share figure
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$123.9M
DCF · Growth Exit 5Y
not applicable
negative equity value — refusing to publish per-share figure
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$123.9M
Earnings Power Value
$0.78
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$19.9M
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000876883-24-000007 (Revenues)
  2. 10-K · period ending 2022-12-31 · accession 0000876883-25-000009 (Revenues)
  3. 10-K · period ending 2023-12-31 · accession 0000876883-26-000010 (Revenues)
  4. 10-K · period ending 2021-12-31 · accession 0000876883-24-000007 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000876883-25-000009 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000876883-26-000010 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000876883-24-000007 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000876883-25-000009 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000876883-26-000010 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000876883-24-000007 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000876883-25-000009 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000876883-26-000010 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000876883-23-000010 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000876883-24-000007 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000876883-25-000009 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0000876883-26-000010 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000876883-23-000010 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000876883-24-000007 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000876883-25-000009 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0000876883-26-000010 (CashAndCashEquivalentsAtCarryingValue)