DCF Tool

EQR

Equity Residential Properties Trust – Other Financial Vehicles
Equity Residential is committed to creating communities where people thrive. The Company, a member of the S&P 500, is focused on the acquisition, development and management of rental apartment properties located in urban and high-density suburban communities where today’s renters want to live, work and play. Equity Residential owns or has investments in 304 properties consisting of 77,889 apartment units, located in Boston, New York, Washington, D.C., Seattle, San Francisco, Southern California and Denver.
Analysis Results
Intrinsic Value $72.46
Latest Price $67.22
Relative Value 7% 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 2.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 6.3%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 2.3%, 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)
2022 1.22 1.14
2023 1.24 1.1
2024 1.27 1.06
2025 1.3 1.02
2026 1.33 0.983
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 31.7 billion. This corresponds to a present value of 21.9 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 5.31 billion. Adding in the terminal value gives a total present value of 27.3 billion.

There are presently 376.0 million outstanding shares, so the intrinsic value per share is 72.46.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 123,832,000
Current Cash 123,832,000
Current Liabilities 791,196,000
Current Debt 315,030,000
Non-Cash Working Capital (NCWC) -476,166,000
Change in NCWC -10,162,000
EBIT 617,029,000
Tax Provision 915,000
Depreciation and Amortization 851,384,000
Capital Expenditure -359,136,000
Unlevered Free Cash Flow 1,098,711,041
Current Assets 42,591,000
Current Cash 42,591,000
Current Liabilities 466,004,000
Current Debt 0
Non-Cash Working Capital (NCWC) -466,004,000
Change in NCWC -87,660,000
EBIT 782,899,000
Tax Provision 852,000
Depreciation and Amortization 832,514,000
Capital Expenditure -366,311,000
Unlevered Free Cash Flow 1,160,724,083
Current Assets 116,999,000
Current Cash 45,753,000
Current Liabilities 449,590,000
Current Debt 0
Non-Cash Working Capital (NCWC) -378,344,000
Change in NCWC -8,263,000
EBIT 976,896,000
Tax Provision -2,281,000
Depreciation and Amortization 842,847,000
Capital Expenditure -374,115,000
Unlevered Free Cash Flow 1,437,365,000
Current Assets 116,313,000
Current Cash 47,442,000
Current Liabilities 438,952,000
Current Debt 0
Non-Cash Working Capital (NCWC) -370,081,000
Change in NCWC 10,442,000
EBIT 856,582,000
Tax Provision 878,000
Depreciation and Amortization 785,725,000
Capital Expenditure -342,932,000
Unlevered Free Cash Flow 1,308,720,786
Current Assets 100,762,000
Current Cash 50,647,000
Current Liabilities 430,638,000
Current Debt 0
Non-Cash Working Capital (NCWC) -380,523,000
Change in NCWC -59,056,000
EBIT 864,961,000
Tax Provision 478,000
Depreciation and Amortization 743,749,000
Capital Expenditure -478,989,000
Unlevered Free Cash Flow 1,070,007,537
Current Assets 219,088,000
Current Cash 77,207,000
Current Liabilities 463,348,000
Current Debt 0
Non-Cash Working Capital (NCWC) -321,467,000
Change in NCWC 124,999,000
EBIT 877,081,000
Tax Provision 1,625,000
Depreciation and Amortization 705,649,000
Capital Expenditure -744,733,000
Unlevered Free Cash Flow 962,677,985
Current Assets 155,115,000
Current Cash 42,276,000
Current Liabilities 559,305,000
Current Debt 0
Non-Cash Working Capital (NCWC) -446,466,000
Change in NCWC -59,525,000
EBIT 1,024,241,000
Tax Provision 917,000
Depreciation and Amortization 765,895,000
Capital Expenditure -840,001,000
Unlevered Free Cash Flow 889,576,670
Current Assets 160,468,000
Current Cash 40,080,000
Current Liabilities 507,329,000
Current Debt 0
Non-Cash Working Capital (NCWC) -386,941,000
Change in NCWC -20,941,000
EBIT 1,132,338,000
Tax Provision 1,402,000
Depreciation and Amortization 758,861,000
Capital Expenditure -721,630,000
Unlevered Free Cash Flow 1,146,222,949
Current Assets 199,737,000
Current Cash 53,534,000
Current Liabilities 512,203,000
Current Debt 0
Non-Cash Working Capital (NCWC) -366,000,000
Change in NCWC -183,812,000
EBIT 485,269,000
Tax Provision 1,618,000
Depreciation and Amortization 1,013,353,000
Capital Expenditure -517,392,000
Unlevered Free Cash Flow 797,006,265
Current Assets 872,161,000
Current Cash 612,590,000
Current Liabilities 441,759,000
Current Debt 0
Non-Cash Working Capital (NCWC) -182,188,000
Change in NCWC 22,575,000
EBIT 690,735,000
Tax Provision 548,000
Depreciation and Amortization 684,992,000
Capital Expenditure -342,058,000
Unlevered Free Cash Flow 1,055,814,715

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