Reverse DCF
What growth rate is priced into Toshiba Machine Co Ltd ADR (TSHMY)?
At the current market price of $11.17, a reverse DCF implies Toshiba Machine Co Ltd ADR (TSHMY) must grow revenue about -14.2% per year for the next decade (-29.3% in year one) to be worth what it trades for — holding margins, taxes, reinvestment, and the discount rate fixed at the model's baseline assumptions.
Market price
$11.17
Implied growth (yr 1)
-29.3%
Implied 10-yr CAGR
-14.2%
Toshiba Machine Co Ltd ADR (TSHMY) reverse DCF FAQ
What revenue growth rate is priced into Toshiba Machine Co Ltd ADR (TSHMY)?
At the current market price of $11.17, a reverse DCF implies Toshiba Machine Co Ltd ADR's revenue must grow about -14.2% per year for the next ten years (starting at -29.3% in year one) to justify the price — holding margins, taxes, reinvestment, and the discount rate at the model's baseline assumptions.
What is a reverse DCF?
A regular DCF turns growth assumptions into a fair value. A reverse DCF inverts that: it holds every other assumption fixed and solves for the single revenue-growth path that makes intrinsic value equal the current market price. The result is the growth the market is already paying for — a hurdle you can judge the business against.
How does the implied growth compare with the model's own TSHMY forecast?
The forward DCF for Toshiba Machine Co Ltd ADR estimates a fair value of $35.27 per share, implying TSHMY is undervalued at the $11.17 market price. If the market-implied growth is well above what the forward model assumes, the price embeds more optimism than the fundamentals-anchored forecast — and vice versa.
How this TSHMY implied growth is solved
The engine takes the same 10-year DCF used for the Toshiba Machine Co Ltd ADR fair-value estimate — margins converging to Damodaran industry benchmarks, year-by-year WACC, a reinvestment rate tied to sales-to-capital efficiency — and inverts it: instead of projecting growth to get a value, it bisects on the starting revenue-growth rate, re-running the valuation until intrinsic value matches the market price. The implied path follows the same moat-scored convergence toward the 2% terminal growth rate that the forward model uses.
The interactive version lets you change what is held fixed — margins, convergence timing, industry benchmarks — and overlays the market-implied growth path on your own editable forecast, so you can see exactly where your expectations and the market's diverge.
The implied growth re-solves when Toshiba Machine Co Ltd ADR files a new quarterly or annual report. For educational/informational purposes only — not investment advice. Last solved 2026-07-10.