Puuilo is a fast-growing Finnish discount retailer (DIY, hardware, home, leisure, pets) with a value-for-money format, strong same-store growth and a disciplined store-rollout strategy. Adjusted ROIC of 26% reflects a capital-efficient, high-return retail model with structural share gains.
Unusually for this slice, the valuation is reasonable: the reverse-DCF brackets the EUR 12.96 price (EUR 10.5 at GDP, EUR 13.9 at 10% growth) on a modest ~3.8% implied growth — fair-to-slightly-rich for a 26%-ROIC discounter with a rollout runway.
Bridging adjusted NOPAT through net debt, reverse-DCF fair value runs EUR 9.5–13.9 across scenarios, bracketing the EUR 13 price at a low ~3.8% implied growth — fair-to-slightly-rich for the quality and growth.
Base EUR 13 (flat); bull EUR 16 (store expansion + same-store growth + margin); bear EUR 10 (a Finnish consumer downturn or rollout slowdown).
The market pays today’s enterprise value for roughly 10.2% NOPAT growth over 5 years. The business earns 26% on capital against a 8% cost of capital (spread +18.3 pp); the no-growth value is €9/share (68% of price), so the rest is priced-in growth.
| Scenario | 24m target | Impl. g | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | €16 | +14% | +14% | 35% | Store expansion + same-store growth + margin |
| Base | €13 | +8% | -7% | 40% | Fair-ish: 26% ROIC, low implied growth |
| Bear | €10 | +1% | -29% | 25% | Finnish consumer downturn / rollout slowdown |
| Prob-weighted | €13 | — | -5% | 100% | Scenario-weighted expected value |
| WACC \ g | 0% | 3% | 5% | 8% | 10% | 15% |
|---|---|---|---|---|---|---|
| 6.50% | 13 | 15 | 17 | 19 | 20 | 25 |
| 7.25% | 11 | 13 | 14 | 15 | 17 | 20 |
| 8.00% (base) | 9 | 11 | 12 | 13 | 14 | 17 |
| 8.75% | 8 | 9 | 10 | 11 | 12 | 14 |
| 9.50% | 7 | 8 | 9 | 10 | 10 | 12 |
Green = fair value above the current price of €14.02. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.
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A capital-efficient, value-for-money format with 26% ROIC and structural share gains.
Continued new-store expansion drives above-market growth.
Strong like-for-like growth complements expansion.
Discount retail holds up relatively well in a downturn.
Solid free cash flow funds expansion and dividends.
Puuilo is a high-ROIC, fast-growing Finnish discount retailer at a reasonable valuation — the most attractively-priced name in this slice. HOLD with a slight positive tilt, medium conviction; base target EUR 13 (flat).
Store expansion plus same-store growth is the upside; a Finnish consumer downturn is the principal risk.