DCF Tool

BF.B

Brown-Forman Corp. – Wineries
For 150 years, Brown-Forman Corporation has enriched the experience of life by responsibly building fine quality beverage alcohol brands, including Jack Daniel's Family of Brands, Finlandia, Korbel, el Jimador, Woodford Reserve, Old Forester, Coopers' Craft, Canadian Mist, Herradura, New Mix, Sonoma-Cutrer, Early Times, Chambord, BenRiach, GlenDronach, Slane, and Fords Gin. Brown-Forman's brands are supported by approximately 4,800 employees and sold in more than 170 countries worldwide.
Analysis Results
Intrinsic Value $77.72
Latest Price $67.50
Relative Value 13% 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 4.2%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 6.4%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 4.2%, 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 1.03 0.971
2024 1.08 0.951
2025 1.12 0.932
2026 1.17 0.912
2027 1.22 0.894
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 28.2 billion. This corresponds to a present value of 19.4 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 4.66 billion. Adding in the terminal value gives a total present value of 24.1 billion.

There are presently 310.0 million outstanding shares, so the intrinsic value per share is 77.72.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 3,776,000,000
Current Cash 868,000,000
Current Liabilities 1,034,000,000
Current Debt 250,000,000
Non-Cash Working Capital (NCWC) 2,124,000,000
Change in NCWC 70,000,000
EBIT 1,263,000,000
Tax Provision 276,000,000
Depreciation and Amortization 79,000,000
Capital Expenditure -138,000,000
Unlevered Free Cash Flow 961,084,380
Current Assets 3,917,000,000
Current Cash 1,150,000,000
Current Liabilities 918,000,000
Current Debt 205,000,000
Non-Cash Working Capital (NCWC) 2,054,000,000
Change in NCWC 11,000,000
EBIT 1,024,000,000
Tax Provision 178,000,000
Depreciation and Amortization 77,000,000
Capital Expenditure -65,000,000
Unlevered Free Cash Flow 878,385,753
Current Assets 3,265,000,000
Current Cash 675,000,000
Current Liabilities 880,000,000
Current Debt 333,000,000
Non-Cash Working Capital (NCWC) 2,043,000,000
Change in NCWC 184,000,000
EBIT 1,102,000,000
Tax Provision 182,000,000
Depreciation and Amortization 74,000,000
Capital Expenditure -119,000,000
Unlevered Free Cash Flow 1,042,224,975
Current Assets 2,719,000,000
Current Cash 307,000,000
Current Liabilities 703,000,000
Current Debt 150,000,000
Non-Cash Working Capital (NCWC) 1,859,000,000
Change in NCWC 149,000,000
EBIT 1,129,000,000
Tax Provision 207,000,000
Depreciation and Amortization 72,000,000
Capital Expenditure -121,000,000
Unlevered Free Cash Flow 1,004,716,890
Current Assets 2,555,000,000
Current Cash 239,000,000
Current Liabilities 821,000,000
Current Debt 215,000,000
Non-Cash Working Capital (NCWC) 1,710,000,000
Change in NCWC 51,000,000
EBIT 1,023,000,000
Tax Provision 260,000,000
Depreciation and Amortization 64,000,000
Capital Expenditure -128,000,000
Unlevered Free Cash Flow 737,758,444
Current Assets 2,351,000,000
Current Cash 182,000,000
Current Liabilities 970,000,000
Current Debt 460,000,000
Non-Cash Working Capital (NCWC) 1,659,000,000
Change in NCWC 209,000,000
EBIT 971,000,000
Tax Provision 264,000,000
Depreciation and Amortization 58,000,000
Capital Expenditure -115,000,000
Unlevered Free Cash Flow 848,247,588
Current Assets 2,233,000,000
Current Cash 263,000,000
Current Liabilities 791,000,000
Current Debt 271,000,000
Non-Cash Working Capital (NCWC) 1,450,000,000
Change in NCWC 84,000,000
EBIT 1,039,000,000
Tax Provision 422,000,000
Depreciation and Amortization 56,000,000
Capital Expenditure -110,000,000
Unlevered Free Cash Flow 774,535,258
Current Assets 2,254,000,000
Current Cash 370,000,000
Current Liabilities 958,000,000
Current Debt 440,000,000
Non-Cash Working Capital (NCWC) 1,366,000,000
Change in NCWC 179,000,000
EBIT 1,049,000,000
Tax Provision 318,000,000
Depreciation and Amortization 51,000,000
Capital Expenditure -121,000,000
Unlevered Free Cash Flow 825,083,832
Current Assets 2,177,000,000
Current Cash 437,000,000
Current Liabilities 561,000,000
Current Debt 8,000,000
Non-Cash Working Capital (NCWC) 1,187,000,000
Change in NCWC 38,000,000
EBIT 956,000,000
Tax Provision 288,000,000
Depreciation and Amortization 50,000,000
Capital Expenditure -128,000,000
Unlevered Free Cash Flow 625,262,935
Current Assets 1,821,000,000
Current Cash 204,000,000
Current Liabilities 473,000,000
Current Debt 5,000,000
Non-Cash Working Capital (NCWC) 1,149,000,000
Change in NCWC 135,000,000
EBIT 897,000,000
Tax Provision 274,000,000
Depreciation and Amortization 51,000,000
Capital Expenditure -97,000,000
Unlevered Free Cash Flow 701,863,583
Current Assets 1,749,000,000
Current Cash 338,000,000
Current Liabilities 404,000,000
Current Debt 7,000,000
Non-Cash Working Capital (NCWC) 1,014,000,000
Change in NCWC 57,000,000
EBIT 787,000,000
Tax Provision 247,000,000
Depreciation and Amortization 49,000,000
Capital Expenditure -65,000,000
Unlevered Free Cash Flow 572,225,000

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