Amphenol Corporation (APH) DCF Valuation & Fundamental Primer
Amphenol Corporation (APH) currently trades at $139.88 with an enterprise value of $199.73B. Our proprietary institutional model rates Amphenol Corporation at 82/100 (Grade: A · High-Quality Compounder). The current market price prices in an implied 5-year revenue CAGR of 11.2% vs. historical growth of 17.0% (Fairly Priced to Fundamentals).
Institutional fundamental teardown of Amphenol Corporation (APH) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
Amphenol Corporation (APH) 3-Scenario DCF Valuation Range
Stress-test APH's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: $139.88).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $192.03 +37% | $203.54 +46% | $216.97 +55% | $232.84 +66% | $251.89 +80% |
| 9.3% | $173.31 +24% | $182.38 +30% | $192.79 +38% | $204.87 +46% | $219.04 +57% |
| 10.0% | $157.92 +13% | $165.21 +18% | $173.48 +24% | $182.92 +31% | $193.81 +39% |
| 10.8% | $145.05 +4% | $151.01 +8% | $157.70 +13% | $165.24 +18% | $173.83 +24% |
| 11.5% | $134.14 -4% | $139.08 -1% | $144.57 +3% | $150.71 +8% | $157.62 +13% |
Institutional Software Quality Scorecard (82/100 · Grade A)
Strong fundamentals, above-average cash generation, and robust competitive positioning.
Elite deferred revenue float; FCF exceeds operating income by >20%
Elevated equity dilution; SBC consumes substantial operating cash flow
Elite Tier-1 SaaS compounder with high gross margin and superior Rule of 40
Positive net cash cushion; self-funding operations with zero insolvency risk
Core Investment Strengths & Moats
- High-grade cash conversion: FCF is 170% of EBIT driven by upfront annual collections
- Top-quartile software unit economics: 81.6% gross margin and 45.4% Rule of 40 score
- Net cash positive: $12.61B balance sheet buffer
Key Operational & Dilution Risks
- Substantial SBC dilution drag: SBC is 17.9% of revenue ($5.11B)
Reverse-DCF Solver: What Growth is Priced Into APH?
Market implies 11.2% annual revenue growth over next 5 years (23.4% dilution-adjusted), in line with company run-rate.
Headline Reverse-DCF ignores Stock-Based Compensation (17.9% of revenue) and annual share dilution (1.8%/yr). Accounting for both requires 23.4% 5-year revenue CAGR to justify $139.88/sh on a true per-share economic cash flow basis.
Amphenol Corporation (APH) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $28.54B | $28.54B | $33.39B | $39.06B | $45.70B | $53.47B | $62.57B |
| Gross Profit | $23.29B | $23.29B | $27.24B | $31.88B | $37.30B | $43.64B | $51.05B |
| Operating Income (EBIT) | $4.77B | $4.77B | $5.58B | $6.52B | $7.63B | $8.93B | $10.45B |
| Stock-Based Compensation (SBC) | $5.11B | $5.11B | $5.98B | $6.99B | $8.18B | $9.57B | $11.20B |
| Unlevered Free Cash Flow (FCF) | $8.10B | $8.10B | $9.48B | $11.09B | $12.98B | $15.19B | $17.77B |
| SBC-Adjusted True Cash Flow | $3.00B | $3.00B | $3.51B | $4.10B | $4.80B | $5.61B | $6.57B |
Software & Cloud Services Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = -31.8 + 0.84 × (Rule of 40) · R² = 82%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| Amphenol Corporation | APH | $171.22B | $28.54B | 81.6% | 28.4% | 45.4% | 17.9% | 5.6× |
| ServiceNow | NOW | $152.61B | $10.98B | 79.2% | 31.1% | 54.2% | 15.9% | 13.9× |
| Workday, Inc. | WDAY | $50.35B | $8.00B | 75.0% | 27.4% | 43.9% | 19.0% | 6.4× |
| Salesforce | CRM | $217.10B | $37.90B | 77.2% | 32.8% | 42.8% | 8.4% | 5.8× |
| Datadog | DDOG | $46.05B | $2.68B | 80.8% | 31.1% | 57.7% | 21.3% | 17.4× |
| Snowflake Inc. | SNOW | $71.79B | $3.63B | 66.5% | 25.2% | 57.7% | 40.8% | 20.0× |
| Hubspot | HUBS | $19.89B | $2.63B | 85.0% | 21.3% | 52.7% | 19.2% | 7.7× |
| Peer Cohort Median Benchmark (N=6) | 78.2% | 29.2% | 53.5% | 19.1% | 10.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 5.6× | $158.61B | $171.22B | $139.88 | 0.0% |
| -20% Multiple Compression | 4.4× | $126.89B | $139.50B | $113.96 | -20.0% |
| -35% Multiple Compression | 3.6× | $103.09B | $115.71B | $94.53 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $142.68B | $155.30B | $126.87 | -10.0% |
Frequently Asked Questions: Amphenol Corporation (APH) Valuation
What is Amphenol Corporation (APH)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, Amphenol Corporation (APH) has a Base Case implied value of $173.48 per share (with a Bear Case of $84.89 and a Bull Case of $291.63), compared to its current price of $139.88. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is Amphenol Corporation (APH)'s Rule of 40 score and Free Cash Flow margin?
Amphenol Corporation achieves a Rule of 40 score of 45.4%, combining a 17.0% revenue growth run-rate with a 28.4% TTM free cash flow margin on $28.54B in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.
What revenue growth rate is priced into APH stock according to Reverse-DCF analysis?
At $139.88 per share (Enterprise Value of $158.61B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 11.2%, compared to Amphenol Corporation's historical CAGR of 17.0%. Overall market expectations are rated as "Fairly Priced to Fundamentals".
How does Amphenol Corporation compare to Software & Cloud Services software peers?
Amphenol Corporation (APH) earns an institutional Software Quality Score of 82/100 (Grade A — High-Quality Compounder). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.
How does Stock-Based Compensation (SBC) impact Amphenol Corporation (APH)'s valuation?
Amphenol Corporation recorded $5.11B in TTM stock-based compensation (17.9% of revenue). When treating SBC as a cash-equivalent compensation expense, Amphenol Corporation's SBC-adjusted free cash flow yield is 1.8%, scoring 10/25 on our Shareholder Dilution Friction pillar.