Judge from a free cash flow valuation whether a stock is priced too high, too low or fairly

Once a free cash flow model yields an intrinsic value per share, the analyst compares it with the market price. Value above price suggests the share is undervalued; value below price suggests it is overvalued. With FCFF, the model gives the value of the whole firm, so debt must be subtracted before dividing by shares; comparing firm value per share with the share price overstates the case for buying. The analyst should also test whether the verdict survives reasonable changes in the discount rate and terminal growth rate, and whether the forecast reinvestment is consistent with the forecast growth. The trap is declaring a share undervalued on a gap smaller than the change produced by a plausible shift in the key assumptions.