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Estee Lauder Cos., Inc. – Toilet Preparation Manufacturing
The Estée Lauder Companies Inc. is one of the world's leading manufacturers and marketers of quality skin care, makeup, fragrance and hair care products. As the global leader in prestige beauty, Estée Lauder touches over half a billion consumers a year. The Company's products are sold in over 150 countries and territories under the following brand names: AERIN, Aramis, Aveda, BECCA, Bobbi Brown, Bumble and bumble, By Kilian, Clinique, Darphin, Donna Karan, DKNY, Dr. Jart+, Editions de Parfums Frédéric Malle, Ermenegildo Zegna, Estée Lauder, GLAMGLOW, Jo Malone London, Kiton, La Mer, Lab Series, Le Labo, M•A•C, Michael Kors, Origins, Prescriptives, RODIN olio lusso, Smashbox, Tom Ford, Tommy Hilfiger and Too Faced.
Analysis Results
Intrinsic Value $405.62
Latest Price $238.50
Relative Value 41% undervalued
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Cash Flow (Billions)
Analysis Parameters
New Ticker
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 15.2%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.3%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 15.2%, 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 2.93 2.83
2024 3.37 3.16
2025 3.88 3.52
2026 4.47 3.92
2027 5.15 4.37
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 155 billion. This corresponds to a present value of 127 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 17.8 billion. Adding in the terminal value gives a total present value of 145 billion.

There are presently 357.0 million outstanding shares, so the intrinsic value per share is 405.62.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 9,298,000,000
Current Cash 3,957,000,000
Current Liabilities 5,815,000,000
Current Debt 268,000,000
Non-Cash Working Capital (NCWC) -206,000,000
Change in NCWC 250,000,000
EBIT 3,544,000,000
Tax Provision 628,000,000
Depreciation and Amortization 727,000,000
Capital Expenditure -1,040,000,000
Unlevered Free Cash Flow 2,747,919,631
Current Assets 9,768,000,000
Current Cash 4,958,000,000
Current Liabilities 5,298,000,000
Current Debt 32,000,000
Non-Cash Working Capital (NCWC) -456,000,000
Change in NCWC -369,000,000
EBIT 3,010,000,000
Tax Provision 456,000,000
Depreciation and Amortization 651,000,000
Capital Expenditure -637,000,000
Unlevered Free Cash Flow 2,242,943,560
Current Assets 8,892,000,000
Current Cash 5,022,000,000
Current Liabilities 5,179,000,000
Current Debt 1,222,000,000
Non-Cash Working Capital (NCWC) -87,000,000
Change in NCWC -223,000,000
EBIT 2,105,000,000
Tax Provision 350,000,000
Depreciation and Amortization 611,000,000
Capital Expenditure -623,000,000
Unlevered Free Cash Flow 1,165,650,095
Current Assets 7,212,000,000
Current Cash 2,987,000,000
Current Liabilities 4,605,000,000
Current Debt 516,000,000
Non-Cash Working Capital (NCWC) 136,000,000
Change in NCWC -190,000,000
EBIT 2,619,000,000
Tax Provision 513,000,000
Depreciation and Amortization 557,000,000
Capital Expenditure -744,000,000
Unlevered Free Cash Flow 1,659,621,586
Current Assets 6,168,000,000
Current Cash 2,715,000,000
Current Liabilities 3,310,000,000
Current Debt 183,000,000
Non-Cash Working Capital (NCWC) 326,000,000
Change in NCWC -263,000,000
EBIT 2,283,000,000
Tax Provision 863,000,000
Depreciation and Amortization 531,000,000
Capital Expenditure -629,000,000
Unlevered Free Cash Flow 926,934,848
Current Assets 4,964,000,000
Current Cash 1,741,000,000
Current Liabilities 2,823,000,000
Current Debt 189,000,000
Non-Cash Working Capital (NCWC) 589,000,000
Change in NCWC 96,300,000
EBIT 1,918,000,000
Tax Provision 361,000,000
Depreciation and Amortization 464,000,000
Capital Expenditure -504,000,000
Unlevered Free Cash Flow 1,546,100,865
Current Assets 4,225,100,000
Current Cash 1,383,400,000
Current Liabilities 2,680,500,000
Current Debt 331,500,000
Non-Cash Working Capital (NCWC) 492,700,000
Change in NCWC -344,900,000
EBIT 1,743,400,000
Tax Provision 434,400,000
Depreciation and Amortization 414,700,000
Capital Expenditure -525,300,000
Unlevered Free Cash Flow 800,931,790
Current Assets 4,468,500,000
Current Cash 1,525,100,000
Current Liabilities 2,135,600,000
Current Debt 29,800,000
Non-Cash Working Capital (NCWC) 837,600,000
Change in NCWC -320,200,000
EBIT 1,606,300,000
Tax Provision 467,200,000
Depreciation and Amortization 409,300,000
Capital Expenditure -473,000,000
Unlevered Free Cash Flow 741,518,697
Current Assets 4,825,200,000
Current Cash 1,629,100,000
Current Liabilities 2,056,700,000
Current Debt 18,400,000
Non-Cash Working Capital (NCWC) 1,157,800,000
Change in NCWC 272,600,000
EBIT 1,824,700,000
Tax Provision 567,700,000
Depreciation and Amortization 384,600,000
Capital Expenditure -510,200,000
Unlevered Free Cash Flow 1,388,695,615
Current Assets 4,297,200,000
Current Cash 1,495,700,000
Current Liabilities 1,934,600,000
Current Debt 18,300,000
Non-Cash Working Capital (NCWC) 885,200,000
Change in NCWC 284,600,000
EBIT 1,558,800,000
Tax Provision 451,400,000
Depreciation and Amortization 336,900,000
Capital Expenditure -461,000,000
Unlevered Free Cash Flow 1,242,319,034
Current Assets 3,855,100,000
Current Cash 1,347,700,000
Current Liabilities 2,125,800,000
Current Debt 219,000,000
Non-Cash Working Capital (NCWC) 600,600,000
Change in NCWC -27,600,000
EBIT 1,393,000,000
Tax Provision 400,600,000
Depreciation and Amortization 295,800,000
Capital Expenditure -420,700,000
Unlevered Free Cash Flow 798,000,753

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