Central Garden & Pet Company

AI-generated fair value estimate for this company.

Method: 10-year DCF on normalized unlevered FCF: $160M normalized annual FCF base (below the $345.6M TTM figure, which was inflated by one-time working-capital/inventory destocking benefits; normalized to ~5.1% of FY2025's $3,129M revenue, closer to CENT's historical FCF margin); 2% annual FCF growth years 1-5 and 2.5% years 6-10 (mature, low-growth consumer products portfolio); 8% discount rate; 2.5% terminal growth; $411.9M net cash (cash $996.7M less total debt $1,409M); 62.59M shares outstanding.

Reasoning: Central Garden & Pet is a mature, modestly-growing consumer staples business with a recently strengthened, net-cash-positive balance sheet, so a long-horizon DCF on a normalized (not one-off-inflated) FCF base is the most appropriate method; revenue has been flat-to-declining so I used conservative low-single-digit growth rather than extrapolating the unusually strong TTM cash conversion.