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Leidos Holdings Inc – Computer Systems Design Services
Leidos is a Fortune 500® information technology, engineering, and science solutions and services leader working to solve the world's toughest challenges in the defense, intelligence, homeland security, civil, and health markets. The company's 38,000 employees support vital missions for government and commercial customers. Headquartered in Reston, Virginia, Leidos reported annual revenues of approximately $11.09 billion for the fiscal year ended January 3, 2020.
Analysis Results
Intrinsic Value $706.39
Latest Price $109.08
Relative Value 85% 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 24.2%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 5.1%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 24.2%, 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)
2022 1.62 1.54
2023 2.01 1.82
2024 2.49 2.15
2025 3.1 2.54
2026 3.85 3.0
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 115 billion. This corresponds to a present value of 85.5 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 11.0 billion. Adding in the terminal value gives a total present value of 96.6 billion.

There are presently 137.0 million outstanding shares, so the intrinsic value per share is 706.39.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 3,619,000,000
Current Cash 727,000,000
Current Liabilities 3,229,000,000
Current Debt 483,000,000
Non-Cash Working Capital (NCWC) 146,000,000
Change in NCWC 138,000,000
EBIT 1,183,000,000
Tax Provision 208,000,000
Depreciation and Amortization 325,000,000
Capital Expenditure -104,000,000
Unlevered Free Cash Flow 1,287,538,779
Current Assets 3,339,000,000
Current Cash 524,000,000
Current Liabilities 2,907,000,000
Current Debt 100,000,000
Non-Cash Working Capital (NCWC) 8,000,000
Change in NCWC 136,000,000
EBIT 1,049,000,000
Tax Provision 152,000,000
Depreciation and Amortization 282,000,000
Capital Expenditure -183,000,000
Unlevered Free Cash Flow 1,079,841,229
Current Assets 2,812,000,000
Current Cash 668,000,000
Current Liabilities 2,333,000,000
Current Debt 61,000,000
Non-Cash Working Capital (NCWC) -128,000,000
Change in NCWC -653,000,000
EBIT 917,000,000
Tax Provision 196,000,000
Depreciation and Amortization 245,000,000
Capital Expenditure -121,000,000
Unlevered Free Cash Flow 180,457,274
Current Assets 2,839,000,000
Current Cash 327,000,000
Current Liabilities 2,059,000,000
Current Debt 72,000,000
Non-Cash Working Capital (NCWC) 525,000,000
Change in NCWC 388,000,000
EBIT 793,000,000
Tax Provision 28,000,000
Depreciation and Amortization 267,000,000
Capital Expenditure -73,000,000
Unlevered Free Cash Flow 1,338,600,000
Current Assets 2,674,000,000
Current Cash 390,000,000
Current Liabilities 2,202,000,000
Current Debt 55,000,000
Non-Cash Working Capital (NCWC) 137,000,000
Change in NCWC 86,000,000
EBIT 698,000,000
Tax Provision 29,000,000
Depreciation and Amortization 350,000,000
Capital Expenditure -81,000,000
Unlevered Free Cash Flow 1,001,493,638
Current Assets 2,381,000,000
Current Cash 376,000,000
Current Liabilities 2,016,000,000
Current Debt 62,000,000
Non-Cash Working Capital (NCWC) 51,000,000
Change in NCWC -175,000,000
EBIT 525,000,000
Tax Provision 72,000,000
Depreciation and Amortization 122,000,000
Capital Expenditure -29,000,000
Unlevered Free Cash Flow 324,132,075
Current Assets 1,618,000,000
Current Cash 443,000,000
Current Liabilities 951,000,000
Current Debt 2,000,000
Non-Cash Working Capital (NCWC) 226,000,000
Change in NCWC -131,000,000
EBIT 356,000,000
Tax Provision 47,000,000
Depreciation and Amortization 62,000,000
Capital Expenditure -29,000,000
Unlevered Free Cash Flow 258,000,000
Current Assets 1,794,000,000
Current Cash 430,000,000
Current Liabilities 1,009,000,000
Current Debt 2,000,000
Non-Cash Working Capital (NCWC) 357,000,000
Change in NCWC -195,000,000
EBIT 280,000,000
Tax Provision 4,000,000
Depreciation and Amortization 81,000,000
Capital Expenditure -53,000,000
Unlevered Free Cash Flow 100,272,727
Current Assets 3,079,000,000
Current Cash 736,000,000
Current Liabilities 1,793,000,000
Current Debt 2,000,000
Non-Cash Working Capital (NCWC) 552,000,000
Change in NCWC 411,000,000
EBIT 772,000,000
Tax Provision 135,000,000
Depreciation and Amortization 113,000,000
Capital Expenditure -48,000,000
Unlevered Free Cash Flow 1,089,610,942
Current Assets 4,205,000,000
Current Cash 1,592,000,000
Current Liabilities 3,025,000,000
Current Debt 553,000,000
Non-Cash Working Capital (NCWC) 141,000,000
Change in NCWC -596,000,000
EBIT 311,000,000
Tax Provision 215,000,000
Depreciation and Amortization 114,000,000
Capital Expenditure -65,000,000
Unlevered Free Cash Flow -451,000,000

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