DCF Tool

LB

L Brands Inc – Men's Clothing Stores
L Brands, through Bath & Body Works, Victoria's Secret and PINK, is an international company. The company operates 2,669 company-operated specialty stores in the United States, Canada and Greater China, in more than 700 franchised locations worldwide and through its websites worldwide.
Analysis Results
Intrinsic Value $42.14
Latest Price $79.92
Relative Value 90% overvalued
Thoughts on this result? Let us know.
Ad
Cash Flow (Billions)
Analysis Parameters
%
%
%
New Ticker
Ad
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 1.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 9.5%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 1.3%, 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 0.945 0.864
2023 0.957 0.799
2024 0.969 0.739
2025 0.982 0.683
2026 0.994 0.632
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 13.5 billion. This corresponds to a present value of 7.86 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 3.72 billion. Adding in the terminal value gives a total present value of 11.6 billion.

There are presently 275.0 million outstanding shares, so the intrinsic value per share is 42.14.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 5,579,000,000
Current Cash 3,903,000,000
Current Liabilities 2,826,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) -1,150,000,000
Change in NCWC -585,000,000
EBIT 1,580,000,000
Tax Provision 248,000,000
Depreciation and Amortization 521,000,000
Capital Expenditure -228,000,000
Unlevered Free Cash Flow 929,172,161
Current Assets 3,245,000,000
Current Cash 1,499,000,000
Current Liabilities 2,372,000,000
Current Debt 61,000,000
Non-Cash Working Capital (NCWC) -565,000,000
Change in NCWC -498,000,000
EBIT 978,000,000
Tax Provision 185,000,000
Depreciation and Amortization 588,000,000
Capital Expenditure -458,000,000
Unlevered Free Cash Flow 610,000,000
Current Assets 3,260,000,000
Current Cash 1,413,000,000
Current Liabilities 1,986,000,000
Current Debt 72,000,000
Non-Cash Working Capital (NCWC) -67,000,000
Change in NCWC 99,000,000
EBIT 1,336,000,000
Tax Provision 213,000,000
Depreciation and Amortization 590,000,000
Capital Expenditure -629,000,000
Unlevered Free Cash Flow 1,063,948,658
Current Assets 3,293,000,000
Current Cash 1,515,000,000
Current Liabilities 2,031,000,000
Current Debt 87,000,000
Non-Cash Working Capital (NCWC) -166,000,000
Change in NCWC 281,000,000
EBIT 1,728,000,000
Tax Provision 329,000,000
Depreciation and Amortization 571,000,000
Capital Expenditure -707,000,000
Unlevered Free Cash Flow 1,439,682,926
Current Assets 3,465,000,000
Current Cash 1,934,000,000
Current Liabilities 2,014,000,000
Current Debt 36,000,000
Non-Cash Working Capital (NCWC) -447,000,000
Change in NCWC -186,000,000
EBIT 2,003,000,000
Tax Provision 538,000,000
Depreciation and Amortization 518,000,000
Capital Expenditure -990,000,000
Unlevered Free Cash Flow 709,614,386
Current Assets 4,156,000,000
Current Cash 2,548,000,000
Current Liabilities 1,875,000,000
Current Debt 6,000,000
Non-Cash Working Capital (NCWC) -261,000,000
Change in NCWC -133,000,000
EBIT 2,192,000,000
Tax Provision 681,000,000
Depreciation and Amortization 457,000,000
Capital Expenditure -727,000,000
Unlevered Free Cash Flow 1,017,153,050
Current Assets 3,232,000,000
Current Cash 1,681,000,000
Current Liabilities 1,679,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) -128,000,000
Change in NCWC -148,000,000
EBIT 1,953,000,000
Tax Provision 594,000,000
Depreciation and Amortization 438,000,000
Capital Expenditure -715,000,000
Unlevered Free Cash Flow 818,903,422
Current Assets 3,150,000,000
Current Cash 1,519,000,000
Current Liabilities 1,826,000,000
Current Debt 215,000,000
Non-Cash Working Capital (NCWC) 20,000,000
Change in NCWC 126,000,000
EBIT 1,743,000,000
Tax Provision 543,000,000
Depreciation and Amortization 407,000,000
Capital Expenditure -691,000,000
Unlevered Free Cash Flow 930,470,954
Current Assets 2,205,000,000
Current Cash 773,000,000
Current Liabilities 1,538,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) -106,000,000
Change in NCWC -70,000,000
EBIT 1,666,000,000
Tax Provision 528,000,000
Depreciation and Amortization 389,000,000
Capital Expenditure -588,000,000
Unlevered Free Cash Flow 710,311,475

This analysis is provided for informational purposes only and does not constitute financial or investing advice. For more information on the advantages and limitations of DCF analysis see background. This information is provided on an "as is" basis. No warranty, expressed or implied, is made regarding accuracy, adequacy, completeness, legality, reliability or usefulness of any information. By using this site you agree that under no circumstances shall Valuation Tools LLC be held liable for any loss or damage caused by information obtained from this website including any articles, data, videos, its social media accounts, or any other materials.