DCF Tool

AVGO

Broadcom Inc – Semiconductor and Related Device Manufacturing
Broadcom Inc., a Delaware corporation headquartered in San Jose, CA, is a global technology leader that designs, develops and supplies a broad range of semiconductor and infrastructure software solutions. Broadcom's category-leading product portfolio serves critical markets including data center, networking, enterprise software, broadband, wireless, storage and industrial. Broadcom Inc solutions include data center networking and storage, enterprise, mainframe and cyber security software focused on automation, monitoring and security, smartphone components, telecoms and factory automation.
Analysis Results
Intrinsic Value $4,423.37
Latest Price $636.22
Relative Value 86% undervalued
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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 29.8%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.4%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 29.8%, 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 (billion) Present value (billion)
2023 23.8 23.0
2024 30.9 28.9
2025 40.1 36.2
2026 52.0 45.4
2027 67.6 57.0
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 2030 billion. This corresponds to a present value of 1650 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 191 billion. Adding in the terminal value gives a total present value of 1840 billion.

There are presently 417.0 million outstanding shares, so the intrinsic value per share is 4423.37.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 18,504,000,000
Current Cash 12,416,000,000
Current Liabilities 7,052,000,000
Current Debt 440,000,000
Non-Cash Working Capital (NCWC) -524,000,000
Change in NCWC 1,044,000,000
EBIT 14,287,000,000
Tax Provision 939,000,000
Depreciation and Amortization 4,984,000,000
Capital Expenditure -424,000,000
Unlevered Free Cash Flow 18,812,063,776
Current Assets 16,586,000,000
Current Cash 12,163,000,000
Current Liabilities 6,281,000,000
Current Debt 290,000,000
Non-Cash Working Capital (NCWC) -1,568,000,000
Change in NCWC -301,000,000
EBIT 8,684,000,000
Tax Provision 29,000,000
Depreciation and Amortization 6,041,000,000
Capital Expenditure -443,000,000
Unlevered Free Cash Flow 13,943,773,688
Current Assets 11,895,000,000
Current Cash 7,618,000,000
Current Liabilities 6,371,000,000
Current Debt 827,000,000
Non-Cash Working Capital (NCWC) -1,267,000,000
Change in NCWC -2,017,000,000
EBIT 4,247,000,000
Tax Provision -518,000,000
Depreciation and Amortization 6,905,000,000
Capital Expenditure -463,000,000
Unlevered Free Cash Flow 8,672,000,000
Current Assets 9,917,000,000
Current Cash 5,055,000,000
Current Liabilities 6,899,000,000
Current Debt 2,787,000,000
Non-Cash Working Capital (NCWC) 750,000,000
Change in NCWC -1,727,000,000
EBIT 4,257,000,000
Tax Provision -510,000,000
Depreciation and Amortization 5,808,000,000
Capital Expenditure -432,000,000
Unlevered Free Cash Flow 7,906,000,000
Current Assets 9,107,000,000
Current Cash 4,292,000,000
Current Liabilities 2,338,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 2,477,000,000
Change in NCWC 270,000,000
EBIT 5,458,000,000
Tax Provision -8,084,000,000
Depreciation and Amortization 4,081,000,000
Capital Expenditure -635,000,000
Unlevered Free Cash Flow 9,174,000,000
Current Assets 15,823,000,000
Current Cash 11,204,000,000
Current Liabilities 2,529,000,000
Current Debt 117,000,000
Non-Cash Working Capital (NCWC) 2,207,000,000
Change in NCWC 803,000,000
EBIT 2,689,000,000
Tax Provision 35,000,000
Depreciation and Amortization 4,737,000,000
Capital Expenditure -1,069,000,000
Unlevered Free Cash Flow 7,108,430,136
Current Assets 7,125,000,000
Current Cash 3,097,000,000
Current Liabilities 3,078,000,000
Current Debt 454,000,000
Non-Cash Working Capital (NCWC) 1,404,000,000
Change in NCWC 545,000,000
EBIT 1,829,000,000
Tax Provision 642,000,000
Depreciation and Amortization 3,042,000,000
Capital Expenditure -723,000,000
Unlevered Free Cash Flow 4,693,000,000
Current Assets 3,775,000,000
Current Cash 1,843,000,000
Current Liabilities 1,119,000,000
Current Debt 46,000,000
Non-Cash Working Capital (NCWC) 859,000,000
Change in NCWC -378,000,000
EBIT 1,776,000,000
Tax Provision 76,000,000
Depreciation and Amortization 962,000,000
Capital Expenditure -593,000,000
Unlevered Free Cash Flow 1,674,991,820
Current Assets 3,835,000,000
Current Cash 1,628,000,000
Current Liabilities 1,016,000,000
Current Debt 46,000,000
Non-Cash Working Capital (NCWC) 1,237,000,000
Change in NCWC 840,000,000
EBIT 600,000,000
Tax Provision 33,000,000
Depreciation and Amortization 625,000,000
Capital Expenditure -409,000,000
Unlevered Free Cash Flow 1,598,105,263
Current Assets 1,818,000,000
Current Cash 999,000,000
Current Liabilities 423,000,000
Current Debt 1,000,000
Non-Cash Working Capital (NCWC) 397,000,000
Change in NCWC 136,000,000
EBIT 555,000,000
Tax Provision 16,000,000
Depreciation and Amortization 187,000,000
Capital Expenditure -236,000,000
Unlevered Free Cash Flow 626,366,197
Current Assets 1,691,000,000
Current Cash 1,085,000,000
Current Liabilities 346,000,000
Current Debt 1,000,000
Non-Cash Working Capital (NCWC) 261,000,000
Change in NCWC 46,000,000
EBIT 589,000,000
Tax Provision 22,000,000
Depreciation and Amortization 155,000,000
Capital Expenditure -241,000,000
Unlevered Free Cash Flow 526,849,572

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