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Graham Holdings Co. – Colleges, Universities, and Professional Schools
Graham Holdings Company is a diversified holding company whose principal operations include educational services; television broadcasting; online, print and local TV news; home health and hospice care; custom manufacturing; automotive; and, restaurant venues. The Company owns Kaplan, a leading global diversified education services leader; Graham Media Group (WDIV-Detroit, KPRC-Houston, WKMG-Orlando, KSAT-San Antonio, WJXT-Jacksonville, WCWJ-Jacksonville, WSLS-Roanoke); The Slate Group; Foreign Policy; Megaphone and Pinna. The Company also owns Code3 (formerly SocialCode) and Decile, leading social marketing solutions companies; Graham Healthcare Group (Celtic Healthcare and Residential Healthcare Group), home health and hospice providers; Dekko, a manufacturer of electrical solutions for applications of workspace power solutions, architectural lighting, electrical components and assemblies; Hoover Treated Wood Products, a manufacturer of pressure-impregnated kiln-dried lumber and plywood products for fire retardant and preservative applications; Joyce/Dayton Corp., a manufacturer of screw jacks, linear actuators and lifting systems; and, Forney Corporation, a manufacturer of burners, igniters, dampers and controls for combustion processes in electric utility and industrial applications. Additionally, the Company owns Lexus of Rockville, Honda of Tysons Corner, and Jeep of Bethesda; Clyde's Restaurant Group (CRG), restaurant and entertainment venues in the Washington, DC metropolitan area; Framebridge, Inc., a custom framing service company; and, CyberVista, a cybersecurity training and workforce development company.
Analysis Results
Intrinsic Value $858.59
Latest Price $613.90
Relative Value 28% undervalued
Thoughts on this result? Let us know.
Cash Flow (Millions)
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 -4.6%.

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 -4.6%, 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 190 179
2023 181 161
2024 173 144
2025 165 129
2026 157 116
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 3710 million. This corresponds to a present value of 2570 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 728 million. Adding in the terminal value gives a total present value of 3290 million.

There are presently 3.84 million outstanding shares, so the intrinsic value per share is 858.59.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 1,847,174,000
Current Cash 970,331,000
Current Liabilities 1,166,338,000
Current Debt 141,749,000
Non-Cash Working Capital (NCWC) -147,746,000
Change in NCWC 22,829,000
EBIT 128,229,000
Tax Provision 96,300,000
Depreciation and Amortization 235,977,000
Capital Expenditure -162,537,000
Unlevered Free Cash Flow 197,034,229
Current Assets 1,774,192,000
Current Cash 1,001,573,000
Current Liabilities 949,646,000
Current Debt 6,452,000
Non-Cash Working Capital (NCWC) -170,575,000
Change in NCWC -74,236,000
EBIT 137,241,000
Tax Provision 107,300,000
Depreciation and Amortization 251,163,000
Capital Expenditure -69,591,000
Unlevered Free Cash Flow 208,419,090
Current Assets 1,663,485,000
Current Cash 800,132,000
Current Liabilities 1,041,871,000
Current Debt 82,179,000
Non-Cash Working Capital (NCWC) -96,339,000
Change in NCWC -55,042,000
EBIT 165,362,000
Tax Provision 98,600,000
Depreciation and Amortization 205,833,000
Capital Expenditure -93,504,000
Unlevered Free Cash Flow 184,418,059
Current Assets 1,532,342,000
Current Cash 767,837,000
Current Liabilities 812,162,000
Current Debt 6,360,000
Non-Cash Working Capital (NCWC) -41,297,000
Change in NCWC 41,952,000
EBIT 268,743,000
Tax Provision 52,100,000
Depreciation and Amortization 112,245,000
Capital Expenditure -98,192,000
Unlevered Free Cash Flow 281,467,740
Current Assets 1,735,804,000
Current Cash 947,167,000
Current Liabilities 878,612,000
Current Debt 6,726,000
Non-Cash Working Capital (NCWC) -83,249,000
Change in NCWC -44,636,000
EBIT 218,716,000
Tax Provision -119,700,000
Depreciation and Amortization 113,310,000
Capital Expenditure -60,358,000
Unlevered Free Cash Flow 227,032,000
Current Assets 1,871,346,000
Current Cash 1,097,126,000
Current Liabilities 818,961,000
Current Debt 6,128,000
Non-Cash Working Capital (NCWC) -38,613,000
Change in NCWC -40,534,000
EBIT 297,200,000
Tax Provision 81,200,000
Depreciation and Amortization 92,894,000
Capital Expenditure -66,612,000
Unlevered Free Cash Flow 186,670,841
Current Assets 1,860,722,000
Current Cash 1,133,652,000
Current Liabilities 725,149,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,921,000
Change in NCWC 315,138,000
EBIT 178,178,000
Tax Provision 20,500,000
Depreciation and Amortization 168,737,000
Capital Expenditure -136,859,000
Unlevered Free Cash Flow 525,194,000
Current Assets 1,690,703,000
Current Cash 999,503,000
Current Liabilities 1,050,792,000
Current Debt 46,375,000
Non-Cash Working Capital (NCWC) -313,217,000
Change in NCWC 7,374,000
EBIT 525,604,000
Tax Provision 406,100,000
Depreciation and Amortization 224,381,000
Capital Expenditure -237,292,000
Unlevered Free Cash Flow 359,230,578
Current Assets 1,702,387,000
Current Cash 1,092,037,000
Current Liabilities 934,109,000
Current Debt 3,168,000
Non-Cash Working Capital (NCWC) -320,591,000
Change in NCWC 39,975,000
EBIT 362,030,000
Tax Provision 110,000,000
Depreciation and Amortization 264,860,000
Capital Expenditure -224,093,000
Unlevered Free Cash Flow 310,567,940
Current Assets 1,453,762,000
Current Cash 931,369,000
Current Liabilities 1,126,286,000
Current Debt 243,327,000
Non-Cash Working Capital (NCWC) -360,566,000
Change in NCWC -3,845,000
EBIT 270,210,000
Tax Provision 71,600,000
Depreciation and Amortization 291,436,000
Capital Expenditure -217,995,000
Unlevered Free Cash Flow 179,396,116

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