DCF Tool

AAP

Advance Auto Parts Inc – New Car Dealers
Advance Auto Parts, Inc., is a leading automotive aftermarket parts provider that serves both professional installer and do-it-yourself customers. As of October 3, 2020, Advance operated 4,811 stores and 168 Worldpac branches in the United States, Canada, Puerto Rico and the U.S. Virgin Islands. The Company also serves 1,269 independently owned Carquest branded stores across these locations in addition to Mexico, the Bahamas, Turks and Caicos and British Virgin Islands.
Analysis Results
Intrinsic Value $97.63
Latest Price $156.34
Relative Value 60% overvalued
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Cash Flow (Billions)
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 -3.9%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 7.8%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of -3.9%, 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 (billion) Present value (billion)
2022 0.443 0.411
2023 0.426 0.366
2024 0.409 0.326
2025 0.393 0.291
2026 0.378 0.259
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 6.62 billion. This corresponds to a present value of 4.22 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 1.65 billion. Adding in the terminal value gives a total present value of 5.87 billion.

There are presently 60.1 million outstanding shares, so the intrinsic value per share is 97.63.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 6,275,476,000
Current Cash 601,428,000
Current Liabilities 5,180,307,000
Current Debt 0
Non-Cash Working Capital (NCWC) 493,741,000
Change in NCWC -197,353,000
EBIT 838,717,000
Tax Provision 189,817,000
Depreciation and Amortization 259,933,000
Capital Expenditure -289,639,000
Unlevered Free Cash Flow 414,117,602
Current Assets 6,270,001,000
Current Cash 834,992,000
Current Liabilities 4,743,915,000
Current Debt 0
Non-Cash Working Capital (NCWC) 691,094,000
Change in NCWC -108,082,000
EBIT 749,907,000
Tax Provision 157,994,000
Depreciation and Amortization 250,081,000
Capital Expenditure -267,806,000
Unlevered Free Cash Flow 442,106,026
Current Assets 5,695,543,000
Current Cash 418,665,000
Current Liabilities 4,477,702,000
Current Debt 0
Non-Cash Working Capital (NCWC) 799,176,000
Change in NCWC -500,801,000
EBIT 677,180,000
Tax Provision 150,850,000
Depreciation and Amortization 238,371,000
Capital Expenditure -270,129,000
Unlevered Free Cash Flow -15,556,567
Current Assets 6,082,454,000
Current Cash 896,527,000
Current Liabilities 3,885,950,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,299,977,000
Change in NCWC -99,881,000
EBIT 604,275,000
Tax Provision 131,417,000
Depreciation and Amortization 238,184,000
Capital Expenditure -193,715,000
Unlevered Free Cash Flow 405,846,331
Current Assets 5,426,892,000
Current Cash 546,937,000
Current Liabilities 3,480,097,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,399,858,000
Change in NCWC 38,012,000
EBIT 570,212,000
Tax Provision 44,754,000
Depreciation and Amortization 249,260,000
Capital Expenditure -189,758,000
Unlevered Free Cash Flow 618,674,916
Current Assets 5,172,764,000
Current Cash 135,178,000
Current Liabilities 3,676,046,000
Current Debt 306,000
Non-Cash Working Capital (NCWC) 1,361,846,000
Change in NCWC 308,761,000
EBIT 787,598,000
Tax Provision 279,213,000
Depreciation and Amortization 258,387,000
Capital Expenditure -259,559,000
Unlevered Free Cash Flow 797,545,983
Current Assets 4,940,746,000
Current Cash 90,782,000
Current Liabilities 3,797,477,000
Current Debt 598,000
Non-Cash Working Capital (NCWC) 1,053,085,000
Change in NCWC 159,200,000
EBIT 825,780,000
Tax Provision 279,490,000
Depreciation and Amortization 269,476,000
Capital Expenditure -234,747,000
Unlevered Free Cash Flow 713,159,749
Current Assets 4,741,040,000
Current Cash 104,671,000
Current Liabilities 3,743,066,000
Current Debt 582,000
Non-Cash Working Capital (NCWC) 893,885,000
Change in NCWC 780,841,000
EBIT 851,710,000
Tax Provision 287,569,000
Depreciation and Amortization 284,693,000
Capital Expenditure -228,446,000
Unlevered Free Cash Flow 1,375,351,271
Current Assets 3,989,384,000
Current Cash 1,112,471,000
Current Liabilities 2,764,785,000
Current Debt 916,000
Non-Cash Working Capital (NCWC) 113,044,000
Change in NCWC 85,966,000
EBIT 660,318,000
Tax Provision 234,640,000
Depreciation and Amortization 207,795,000
Capital Expenditure -195,757,000
Unlevered Free Cash Flow 510,976,038
Current Assets 3,184,200,000
Current Cash 598,111,000
Current Liabilities 2,559,638,000
Current Debt 627,000
Non-Cash Working Capital (NCWC) 27,078,000
Change in NCWC -21,814,000
EBIT 657,315,000
Tax Provision 236,404,000
Depreciation and Amortization 189,544,000
Capital Expenditure -271,182,000
Unlevered Free Cash Flow 304,867,055

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