The market is too optimistic about how quickly acquisitions become earnings for shareholders. My $47.14 twelve-month target allows for substantial profit growth and a Berkshire-backed valuation premium, but also counts recurring restructuring costs, financing and dilution.
Key points
- 73% profit growth by 2027 is required at my chosen earnings multiple.
- $1.68 a share is my 2027 earnings forecast after recurring transformation costs.
- $47.14 a share is my twelve-month target, supporting Sell.
The call
The price demands faster execution than I expect. At 28 times normalized earnings, today's shares require $2.56 billion of adjusted operating profit in 2027. That means roughly 73% growth from the midpoint of management's acquisition-limited 2026 outlook, before allowing for recurring transformation costs.
What lifts quarterly operating profit ($ millions)Source: August 13, 2026 Q2 release; adjustments to reported operating profit.
I expect strong growth, but less profit reaches shareholders. My 2027 adjusted operating-profit forecast is $2.27 billion, including Airtable and Miro. Their disclosed subscription bases strengthen the acquisition case, but integration costs and financing absorb part of the gain. The next consolidated outlook should expose that difference, even if Berkshire's endorsement sustains enthusiasm.
Valuation
| Driver | My estimate |
|---|
| 2027 revenue | $4.41 billion |
| 2027 normalized earnings per share | $1.68 |
| Base earnings multiple | 25 times |
| Berkshire and acquisition-platform premium | 3 times |
| Total earnings multiple | 28 times |
| Twelve-month target, using unrounded earnings | $47.14 a share |
Normalized earnings deduct annual restructuring costs of $150 million, interest of $550 million and a 25% tax rate, using 700 million diluted shares. The premium rewards access to capital and acquisition opportunities; it disappears if returns deteriorate. Strong momentum makes a higher multiple the principal upside risk, so this is Sell, not Strong Sell.
The target depends on the earnings multipleAnalyst scenarios, October 15, 2026; own 2027 normalized earnings forecast held constant.
Risks
- Acquisitions outperform: watch customer retention and enterprise sales rather than headline revenue added through purchases.
- Berkshire's endorsement sustains a richer multiple: watch further funding terms and acquisitions that increase earnings per share.
- Financing improves: watch the next debt schedule and cash-interest bill; June's balance sheet is no longer current.
What would change my mind
I would withdraw the sell if disclosures support at least $2.56 billion of 2027 adjusted operating profit without higher financing costs, restructuring spending or dilution than my assumptions.