DCF Tool

AAON

AAON Inc. – Air-Conditioning and Warm Air Heating Equipment and Commercial and Industrial Refrigeration Equipment Manufacturing
AAON, Inc. is engaged in the engineering, manufacturing, marketing and sale of air conditioning and heating equipment consisting of standard, semi-custom and custom rooftop units, chillers, packaged outdoor mechanical rooms, air handling units, makeup air units, energy recovery units, condensing units, geothermal/water-source heat pumps, coils and controls. Since the founding of AAON in 1988, AAON has maintained a commitment to design, develop, manufacture and deliver heating and cooling products to perform beyond all expectations and demonstrate the value of AAON to its customers.
Analysis Results
Intrinsic Value $116.30
Latest Price $90.19
Relative Value 22% undervalued
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Cash Flow (Millions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 17.8%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.8%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 17.8%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (million) Present value (million)
2023 120 116
2024 142 131
2025 167 149
2026 197 169
2027 232 192
Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 6960 million. This corresponds to a present value of 5560 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 758 million. Adding in the terminal value gives a total present value of 6310 million.

There are presently 54.3 million outstanding shares, so the intrinsic value per share is 116.3.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 349,116,000
Current Cash 5,451,000
Current Liabilities 145,567,000
Current Debt 0
Non-Cash Working Capital (NCWC) 198,098,000
Change in NCWC 69,645,000
EBIT 126,749,000
Tax Provision 24,157,000
Depreciation and Amortization 35,430,000
Capital Expenditure -76,024,000
Unlevered Free Cash Flow 131,213,138
Current Assets 218,080,000
Current Cash 2,859,000
Current Liabilities 86,768,000
Current Debt 0
Non-Cash Working Capital (NCWC) 128,453,000
Change in NCWC 46,260,000
EBIT 69,232,000
Tax Provision 10,424,000
Depreciation and Amortization 30,416,000
Capital Expenditure -55,362,000
Unlevered Free Cash Flow 80,114,466
Current Assets 220,251,000
Current Cash 79,025,000
Current Liabilities 59,033,000
Current Debt 0
Non-Cash Working Capital (NCWC) 82,193,000
Change in NCWC -22,531,000
EBIT 95,358,000
Tax Provision 22,966,000
Depreciation and Amortization 25,634,000
Capital Expenditure -67,802,000
Unlevered Free Cash Flow 9,183,228
Current Assets 187,549,000
Current Cash 26,797,000
Current Liabilities 56,028,000
Current Debt 0
Non-Cash Working Capital (NCWC) 104,724,000
Change in NCWC 13,928,000
EBIT 67,348,000
Tax Provision 13,320,000
Depreciation and Amortization 22,766,000
Capital Expenditure -37,166,000
Unlevered Free Cash Flow 53,493,007
Current Assets 140,861,000
Current Cash 1,994,000
Current Liabilities 48,071,000
Current Debt 0
Non-Cash Working Capital (NCWC) 90,796,000
Change in NCWC 17,548,000
EBIT 55,778,000
Tax Provision 13,367,000
Depreciation and Amortization 17,655,000
Capital Expenditure -37,268,000
Unlevered Free Cash Flow 40,384,472
Current Assets 153,727,000
Current Cash 30,414,000
Current Liabilities 50,065,000
Current Debt 0
Non-Cash Working Capital (NCWC) 73,248,000
Change in NCWC 15,057,000
EBIT 74,148,000
Tax Provision 19,994,000
Depreciation and Amortization 15,007,000
Capital Expenditure -41,713,000
Unlevered Free Cash Flow 42,597,331
Current Assets 140,981,000
Current Cash 43,748,000
Current Liabilities 39,042,000
Current Debt 0
Non-Cash Working Capital (NCWC) 58,191,000
Change in NCWC 7,823,000
EBIT 79,529,000
Tax Provision 26,615,000
Depreciation and Amortization 13,035,000
Capital Expenditure -26,604,000
Unlevered Free Cash Flow 47,321,718
Current Assets 124,213,000
Current Cash 30,432,000
Current Liabilities 43,413,000
Current Debt 0
Non-Cash Working Capital (NCWC) 50,368,000
Change in NCWC 2,020,000
EBIT 71,243,000
Tax Provision 25,611,000
Depreciation and Amortization 11,741,000
Capital Expenditure -20,967,000
Unlevered Free Cash Flow 38,460,464
Current Assets 131,083,000
Current Cash 40,022,000
Current Liabilities 42,713,000
Current Debt 0
Non-Cash Working Capital (NCWC) 48,348,000
Change in NCWC 7,289,000
EBIT 67,701,000
Tax Provision 24,088,000
Depreciation and Amortization 11,553,000
Capital Expenditure -16,127,000
Unlevered Free Cash Flow 46,520,362
Current Assets 113,623,000
Current Cash 36,235,000
Current Liabilities 36,329,000
Current Debt 0
Non-Cash Working Capital (NCWC) 41,059,000
Change in NCWC -1,751,000
EBIT 55,803,000
Tax Provision 18,747,000
Depreciation and Amortization 12,312,000
Capital Expenditure -9,041,000
Unlevered Free Cash Flow 38,739,512
Current Assets 91,546,000
Current Cash 9,111,000
Current Liabilities 39,625,000
Current Debt 0
Non-Cash Working Capital (NCWC) 42,810,000
Change in NCWC -7,452,000
EBIT 44,238,000
Tax Provision 16,868,000
Depreciation and Amortization 13,407,000
Capital Expenditure -14,147,000
Unlevered Free Cash Flow 19,208,069

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