DCF Tool


Gates Industrial Corporation plc – Mechanical Power Transmission Equipment Manufacturing
gates is the world’s leading manufacturer of power transmission belts and a premier global manufacturer of fluid power products. our highly engineered products are critical components used in diverse industrial and automotive applications where the cost of failure is very high relative to the cost of our products. we provide a differentiated value proposition to our customers by offering a complete portfolio of premium product and service solutions for both replacement and first-fit applications across our targeted end markets, which encompass process and specialty, construction, agriculture, energy, transportation and automotive. we sell our products globally under the gates brand, which is recognized by distributors, original equipment manufacturers and installers as the premium brand for quality and technological innovation, a reputation which we have built for over a century since our founding in 1911. if it moves you, there’s a good chance gates has a part in it. gates. powering
Analysis Results
Intrinsic Value $62.90
Latest Price $11.71
Relative Value 81% 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 9.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 7.5%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 9.3%, 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)
2023 0.749 0.697
2024 0.819 0.709
2025 0.896 0.722
2026 0.979 0.734
2027 1.07 0.747
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 20.0 billion. This corresponds to a present value of 13.0 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 3.61 billion. Adding in the terminal value gives a total present value of 16.6 billion.

There are presently 264.0 million outstanding shares, so the intrinsic value per share is 62.9.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 2,277,400,000
Current Cash 578,400,000
Current Liabilities 752,300,000
Current Debt 36,600,000
Non-Cash Working Capital (NCWC) 983,300,000
Change in NCWC 180,600,000
EBIT 396,900,000
Tax Provision 14,900,000
Depreciation and Amortization 217,200,000
Capital Expenditure -87,000,000
Unlevered Free Cash Flow 684,724,825
Current Assets 2,278,700,000
Current Cash 658,200,000
Current Liabilities 855,900,000
Current Debt 38,100,000
Non-Cash Working Capital (NCWC) 802,700,000
Change in NCWC 101,100,000
EBIT 486,500,000
Tax Provision 18,400,000
Depreciation and Amortization 222,600,000
Capital Expenditure -87,000,000
Unlevered Free Cash Flow 697,602,058
Current Assets 1,906,600,000
Current Cash 521,400,000
Current Liabilities 726,300,000
Current Debt 42,700,000
Non-Cash Working Capital (NCWC) 701,600,000
Change in NCWC -9,700,000
EBIT 257,800,000
Tax Provision -19,300,000
Depreciation and Amortization 218,600,000
Capital Expenditure -67,400,000
Unlevered Free Cash Flow 399,300,000
Current Assets 1,958,600,000
Current Cash 635,300,000
Current Liabilities 658,100,000
Current Debt 46,100,000
Non-Cash Working Capital (NCWC) 711,300,000
Change in NCWC -52,500,000
EBIT 365,200,000
Tax Provision -495,900,000
Depreciation and Amortization 222,200,000
Capital Expenditure -83,100,000
Unlevered Free Cash Flow 451,800,000
Current Assets 1,814,600,000
Current Cash 423,400,000
Current Liabilities 679,000,000
Current Debt 51,600,000
Non-Cash Working Capital (NCWC) 763,800,000
Change in NCWC 133,400,000
EBIT 524,800,000
Tax Provision 31,800,000
Depreciation and Amortization 218,500,000
Capital Expenditure -182,700,000
Unlevered Free Cash Flow 639,012,718

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