United Airlines Holdings scores 43 for management and 55 for moat. The management score rests on a return on invested capital of 6.6% and a gross margin of 64.1% — figures that describe returns closer to the cost of the capital behind them. The balance sheet carries debt at 2.03x equity, which magnifies both the returns above and the risk beneath them.
Three independent anchors set the price worth paying. Growth is modelled at 15.0% a year, below the 31.0% actually measured over the last decade — the model caps growth rather than extrapolating a good run forwards. The exit multiple assumed is 16.7x. That produces an intrinsic value of $178.32, a 10-CAP price of $136.40 and a payback time price of $215.31, with the value zone set at the highest of the three, $215.31. Today's price of $111.78 sits inside that zone.
The price sits inside the value zone, but the business scores 55 for moat and 43 for management. Cheap and good are different tests, and only one of them is passed here.
| Price | $111.78 |
| Market cap | $36.3B |
| P/E ratio | 10.5x |
| Return on invested capital | 6.6% |
| Gross margin | 64.1% |
| Debt to equity | 2.03x |
| Free cash flow yield | 7.0% |
| Growth rate used | 15.0% |
| Growth rate measured | 31.0% |
| Exit multiple assumed | 16.7x |
| Company | Moat | Buy price |
| Paychex Inc. (PAYX) | 80 | $73.39 |
| Old Dominion Freight Line (ODFL) | 55 | $61.58 |
| Waste Connections Inc (WCN) | 78 | $107.96 |
| Ferrovial SE (FER) | 69 | $56.45 |
Every number above is built on assumptions that can be changed. In Moatly you can move the growth rate, the exit multiple and the margin of safety and watch every figure recalculate, so you are testing your own view of United Airlines Holdings rather than accepting ours.