At today's price, Corteva's stock is pricing in about 11.8% annual free-cash-flow growth for the next ten years. Over the past five years, the company's actual FCF grew 6.9% a year — but Corteva is scheduled to split into two separate companies in October 2026, which breaks the model's core assumption of a single, continuous business.
At its current price, CTVA implies ~11.8% annual FCF growth for the next 10 years, discounted at 9%.
Corteva's actual 5-year FCF growth has averaged 6.9% a year.
Required growth vs. historical growth
Required growth from the reverse DCF below. Historical CAGRs from 10-K FY2021–FY2025. FCF: $2,154M (2021) → $267M (2022) → $1,174M (2023) → $1,548M (2024) → $2,815M (2025).
Sensitivity: what if the discount rate moves?
| WACC | Required growth | Note |
|---|---|---|
| 7% | 6.63% | Close to the actual 5-yr pace (6.9%) |
| 9% (base case) | 11.78% | Typical large-cap assumption |
| 11% | 16.10% | Gap widens further |
Only at the lowest discount rate tested (7%) does the required growth rate roughly match Corteva's actual 5-year FCF pace — meaning this price is justified only if Corteva is treated as a safer-than-typical asset, or if FCF is expected to grow faster than its recent trend. It's one or the other.
What would move this number
- Using 2025's standalone FCF ($2,815M) instead of the 3-year average ($1,846M) drops the required growth rate sharply, from 11.78% to 6.21%. This analysis used the 3-year average as the base case because 2025's figure ran +52.5% above it — past this analysis's normalization threshold. If 2025's elevated FCF is the "new normal" rather than a one-off, the market's expectations look far less aggressive.
- Using year-end 2025 net debt instead of the most current figure (Jun 30, 2026) lowers the required growth rate from 11.78% to 10.74%. Corteva actually held net cash of $1,941M at year-end 2025, before Bayer settlement payments, an FMC prepayment, and an early pension contribution flipped it to net debt of $2,510M by mid-2026 — this analysis uses the most current figure.
- The pending Seed/Crop Protection split (Oct 1, 2026) means the combined-company growth story this model assumes won't exist for the full 10-year window — a structural wrinkle no sensitivity adjustment can fully capture.
Show your work
Inputs, sources, model assumptions, and the calculation
- Share price$83.90 — stockanalysis.com, Aug 28, 2026 close
- Diluted shares outstanding669.8M — 10-Q Q2 FY2026, non-GAAP EPS reconciliation (3-month basis)
- Market cap$56,196M — price × diluted shares (calculated)
- Base FCF (3-year average, normalized)$1,845.7M — FY2023 ($1,174M), FY2024 ($1,548M), FY2025 ($2,815M), averaged
- Net debt$2,510M — 10-Q Q2 FY2026 (Jun 30, 2026): $4,875M total debt minus $2,365M cash and marketable securities
- Discount rate (WACC)9% base case (7%/11% tested)
- Terminal growth rate2.5% — long-run GDP-level assumption
Normalization check: 2025 FCF ($2,815M) is +52.5% above the three-year average ($1,845.7M) — beyond the ±40% threshold, so the 3-year average was used as the base case per standard normalization practice.
Model: free cash flow is assumed to grow at a constant annual rate g for 10 years, then at a 2.5% terminal rate thereafter, solved by bisection for the value of g that equates present value to today's target enterprise value ($58,706M = market cap + net debt).
Historical CAGR check: 5-yr FCF CAGR = ($2,815M ÷ $2,154M)^(1/4) − 1 = 6.92%. 5-yr revenue CAGR = ($17,401M ÷ $15,655M)^(1/4) − 1 = 2.68%. A 10-year CAGR wasn't calculated since Corteva only has independent financials going back to its 2019 DowDuPont spinoff.
The fine print
- This isn't a fair-value price target — it only shows what the current price already assumes.
- Change the discount rate or the FCF base period, and the answer moves substantially — see the sensitivity table above.
- Corteva is scheduled to split into two independent companies on October 1, 2026 — meaning the "one company for 10 years" assumption this reverse DCF depends on won't hold, and part of the market's elevated growth expectation may reflect anticipated value re-rating from the split, as covered in the story piece above.
- A reverse DCF shows what the market currently expects — it does not say what the stock is "worth."
- Any investment decision, and its outcome, is your own responsibility.
Frequently asked questions
What growth rate does CTVA's stock price assume?
At today's price, Corteva's stock is pricing in about 11.8% annual free-cash-flow growth for the next ten years, at a 9% discount rate.
How does that compare to Corteva's actual growth?
Corteva's actual 5-year FCF growth (2021-2025) was 6.9% a year — about 60% of the 11.8% the current price requires. Revenue grew much more slowly, at 2.7% a year.
What share price was used for this analysis?
This analysis used $83.90, as of the Aug 28, 2026 close.