DCF Tool

CF

cf industries, a global leader in nitrogen fertilizer manufacturing and distribution, owns and operates world-scale nitrogen complexes and serves agricultural and industrial customers through its best-in-class distribution system. founded in 1946 as a fertilizer brokerage operation by a group of regional agricultural cooperatives, cf industries grew by expanding its distribution capabilities and diversifying into fertilizer manufacturing. through 2002, the company operated as a typical supply cooperative. however, in 2003, in response to changing market conditions, it adopted a new business model that established financial performance, rather than the traditional cooperative charge of providing an assured supply of product to its owners, as its principal objective. in 2005, an initial public offering completed the company’s transition and established cf industries holdings, inc. as a public company. its common stock is traded on the new york stock exchange under the symbol “cf.” in sep
Analysis Results
Intrinsic Value $360.76
Latest Price $78.10
Relative Value 78% 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 8.4%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 5.8%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 8.4%, 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)
2024 2.15 2.03
2025 2.33 2.08
2026 2.53 2.14
2027 2.74 2.19
2028 2.97 2.24
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 80.0 billion. This corresponds to a present value of 57.0 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 10.7 billion. Adding in the terminal value gives a total present value of 67.7 billion.

There are presently 188.0 million outstanding shares, so the intrinsic value per share is 360.76.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 3,050,000,000
Current Cash 2,032,000,000
Current Liabilities 800,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 218,000,000
Change in NCWC -137,000,000
EBIT 2,248,000,000
Tax Provision 410,000,000
Depreciation and Amortization 869,000,000
Capital Expenditure -499,000,000
Unlevered Free Cash Flow 2,071,000,000
Current Assets 3,673,000,000
Current Cash 2,323,000,000
Current Liabilities 995,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 355,000,000
Change in NCWC 822,000,000
EBIT 5,665,000,000
Tax Provision 1,158,000,000
Depreciation and Amortization 850,000,000
Capital Expenditure -453,000,000
Unlevered Free Cash Flow 5,596,449,460
Current Assets 2,593,000,000
Current Cash 1,628,000,000
Current Liabilities 1,432,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) -467,000,000
Change in NCWC -494,000,000
EBIT 2,211,000,000
Tax Provision 283,000,000
Depreciation and Amortization 888,000,000
Capital Expenditure -514,000,000
Unlevered Free Cash Flow 1,685,482,825
Current Assets 1,367,000,000
Current Cash 683,000,000
Current Liabilities 906,000,000
Current Debt 249,000,000
Non-Cash Working Capital (NCWC) 27,000,000
Change in NCWC 5,000,000
EBIT 606,000,000
Tax Provision 31,000,000
Depreciation and Amortization 892,000,000
Capital Expenditure -309,000,000
Unlevered Free Cash Flow 1,153,425,485
Current Assets 974,000,000
Current Cash 287,000,000
Current Liabilities 665,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 22,000,000
Change in NCWC 135,000,000
EBIT 930,000,000
Tax Provision 126,000,000
Depreciation and Amortization 875,000,000
Capital Expenditure -404,000,000
Unlevered Free Cash Flow 1,384,212,435
Current Assets 1,274,000,000
Current Cash 682,000,000
Current Liabilities 705,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) -113,000,000
Change in NCWC -163,000,000
EBIT 739,000,000
Tax Provision 119,000,000
Depreciation and Amortization 888,000,000
Capital Expenditure -422,000,000
Unlevered Free Cash Flow 881,230,347
Current Assets 1,465,000,000
Current Cash 835,000,000
Current Liabilities 580,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 50,000,000
Change in NCWC -755,000,000
EBIT 247,000,000
Tax Provision -575,000,000
Depreciation and Amortization 883,000,000
Capital Expenditure -473,000,000
Unlevered Free Cash Flow -98,000,000
Current Assets 2,655,000,000
Current Cash 1,164,000,000
Current Liabilities 686,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 805,000,000
Change in NCWC 1,179,100,000
EBIT 521,000,000
Tax Provision -68,000,000
Depreciation and Amortization 678,000,000
Capital Expenditure -2,211,000,000
Unlevered Free Cash Flow 167,100,000
Current Assets 1,127,100,000
Current Cash 286,000,000
Current Liabilities 1,215,200,000
Current Debt 0
Non-Cash Working Capital (NCWC) -374,100,000
Change in NCWC -12,300,000
EBIT 1,414,600,000
Tax Provision 395,800,000
Depreciation and Amortization 479,600,000
Capital Expenditure -2,469,300,000
Unlevered Free Cash Flow -1,082,929,409
Current Assets 2,614,500,000
Current Cash 1,996,600,000
Current Liabilities 979,700,000
Current Debt 0
Non-Cash Working Capital (NCWC) -361,800,000
Change in NCWC -452,800,000
EBIT 1,692,200,000
Tax Provision 773,000,000
Depreciation and Amortization 392,500,000
Capital Expenditure -1,808,500,000
Unlevered Free Cash Flow -768,540,718
Current Assets 2,630,100,000
Current Cash 1,710,800,000
Current Liabilities 828,300,000
Current Debt 0
Non-Cash Working Capital (NCWC) 91,000,000
Change in NCWC 503,500,000
EBIT 2,405,500,000
Tax Provision 686,500,000
Depreciation and Amortization 410,600,000
Capital Expenditure -823,800,000
Unlevered Free Cash Flow 1,751,702,424
Current Assets 2,807,600,000
Current Cash 2,274,900,000
Current Liabilities 950,200,000
Current Debt 5,000,000
Non-Cash Working Capital (NCWC) -412,500,000
Change in NCWC 27,100,000
EBIT 3,044,700,000
Tax Provision 964,200,000
Depreciation and Amortization 419,800,000
Capital Expenditure -523,500,000
Unlevered Free Cash Flow 1,951,442,658

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