DCF Tool

CARS

Cars.com – Software Publishers
Cars.com Inc. is a leading digital marketplace and solutions provider for the automotive industry that connects car shoppers with sellers. Launched in 1998 with the flagship marketplace site Cars.com and headquartered in Chicago, the Company empowers shoppers with the data, resources and digital tools needed to make informed buying decisions and seamlessly connect with automotive retailers. In a rapidly changing market, CARS enables dealerships and OEMs with innovative technical solutions and data-driven intelligence to better reach and influence ready-to-buy shoppers, increase inventory turn and gain market share.
Analysis Results
Intrinsic Value $7.90
Latest Price $12.95
Relative Value 64% overvalued
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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 -15.7%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 9.4%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of -15.7%, 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)
2022 77.0 70.4
2023 64.9 54.2
2024 54.8 41.8
2025 46.2 32.2
2026 39.0 24.8
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 536 million. This corresponds to a present value of 313 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 224 million. Adding in the terminal value gives a total present value of 536 million.

There are presently 67.9 million outstanding shares, so the intrinsic value per share is 7.9.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 147,437,000
Current Cash 39,069,000
Current Liabilities 94,290,000
Current Debt 8,941,000
Non-Cash Working Capital (NCWC) 23,019,000
Change in NCWC -4,731,000
EBIT 48,338,000
Tax Provision 1,764,000
Depreciation and Amortization 101,932,000
Capital Expenditure -19,192,000
Unlevered Free Cash Flow 117,355,306
Current Assets 178,081,000
Current Cash 67,719,000
Current Liabilities 90,368,000
Current Debt 7,756,000
Non-Cash Working Capital (NCWC) 27,750,000
Change in NCWC -13,726,000
EBIT 18,558,000
Tax Provision -119,289,000
Depreciation and Amortization 113,276,000
Capital Expenditure -16,712,000
Unlevered Free Cash Flow 101,396,000
Current Assets 122,440,000
Current Cash 13,549,000
Current Liabilities 98,806,000
Current Debt 31,391,000
Non-Cash Working Capital (NCWC) 41,476,000
Change in NCWC -3,141,000
EBIT 15,403,000
Tax Provision -29,955,000
Depreciation and Amortization 116,877,000
Capital Expenditure -21,257,000
Unlevered Free Cash Flow 107,882,000
Current Assets 153,937,000
Current Cash 25,463,000
Current Liabilities 110,710,000
Current Debt 26,853,000
Non-Cash Working Capital (NCWC) 44,617,000
Change in NCWC -8,468,000
EBIT 83,924,000
Tax Provision 18,120,000
Depreciation and Amortization 103,810,000
Capital Expenditure -14,233,000
Unlevered Free Cash Flow 138,320,728
Current Assets 142,639,000
Current Cash 20,563,000
Current Liabilities 90,149,000
Current Debt 21,158,000
Non-Cash Working Capital (NCWC) 53,085,000
Change in NCWC 13,423,000
EBIT 134,256,000
Tax Provision -102,281,000
Depreciation and Amortization 88,639,000
Capital Expenditure -32,774,000
Unlevered Free Cash Flow 203,544,000
Current Assets 119,541,000
Current Cash 8,896,000
Current Liabilities 70,983,000
Current Debt 0
Non-Cash Working Capital (NCWC) 39,662,000
Change in NCWC 29,615,000
EBIT 176,650,000
Tax Provision 59,965,000
Depreciation and Amortization 83,106,000
Capital Expenditure -9,701,000
Unlevered Free Cash Flow 212,689,593

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