DCF Tool

MDC

M.D.C. Holdings, Inc. – New Single-Family Housing Construction (except For-Sale Builders)
M.D.C. Holdings, Inc. was founded in 1972. MDC's homebuilding subsidiaries, which operate under the name Richmond American Homes, have built and financed the American Dream for more than 210,000 homebuyers since 1977. MDC's commitment to customer satisfaction, quality and value is reflected in each home its subsidiaries build. MDC is one of the largest homebuilders in the United States. Its subsidiaries have homebuilding operations across the country, including the metropolitan areas of Denver, Colorado Springs, Salt Lake City, Las Vegas, Phoenix, Tucson, Riverside-San Bernardino, Los Angeles, San Diego, Orange County, San Francisco Bay Area, Sacramento, Washington D.C., Baltimore, Orlando, Jacksonville, Seattleand Portland. MDC's subsidiaries also provide mortgage financing, insurance and title services, primarily for Richmond American homebuyers, through HomeAmerican Mortgage Corporation, American Home Insurance Agency, Inc. and American Home Title and Escrow Company, respectively. M.D.C. Holdings, Inc. is traded on the New York Stock Exchange under the symbol 'MDC.'
Analysis Results
Intrinsic Value $169.01
Latest Price $37.45
Relative Value 78% 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 10.6%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 1.9%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 10.6%, 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 (billion) Present value (billion)
2023 0.698 0.64
2024 0.772 0.649
2025 0.853 0.659
2026 0.943 0.668
2027 1.04 0.678
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 15.2 billion. This corresponds to a present value of 9.06 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 3.29 billion. Adding in the terminal value gives a total present value of 12.4 billion.

There are presently 73.1 million outstanding shares, so the intrinsic value per share is 169.01.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 5,193,616,000
Current Cash 1,139,787,000
Current Liabilities 762,338,000
Current Debt 10,000,000
Non-Cash Working Capital (NCWC) 3,301,491,000
Change in NCWC -169,030,000
EBIT 903,877,000
Tax Provision 197,715,000
Depreciation and Amortization 27,751,000
Capital Expenditure -29,075,000
Unlevered Free Cash Flow 498,333,027
Current Assets 4,804,521,000
Current Cash 485,839,000
Current Liabilities 858,161,000
Current Debt 10,000,000
Non-Cash Working Capital (NCWC) 3,470,521,000
Change in NCWC 820,995,000
EBIT 776,376,000
Tax Provision 178,037,000
Depreciation and Amortization 31,666,000
Capital Expenditure -29,693,000
Unlevered Free Cash Flow 1,415,461,124
Current Assets 3,728,284,000
Current Cash 411,362,000
Current Liabilities 677,396,000
Current Debt 10,000,000
Non-Cash Working Capital (NCWC) 2,649,526,000
Change in NCWC 409,221,000
EBIT 466,438,000
Tax Provision 89,930,000
Depreciation and Amortization 27,166,000
Capital Expenditure -26,777,000
Unlevered Free Cash Flow 784,363,477
Current Assets 3,185,110,000
Current Cash 424,186,000
Current Liabilities 535,619,000
Current Debt 15,000,000
Non-Cash Working Capital (NCWC) 2,240,305,000
Change in NCWC 209,877,000
EBIT 302,489,000
Tax Provision 66,677,000
Depreciation and Amortization 23,054,000
Capital Expenditure -24,714,000
Unlevered Free Cash Flow 444,575,552
Current Assets 2,867,262,000
Current Cash 414,724,000
Current Liabilities 437,110,000
Current Debt 15,000,000
Non-Cash Working Capital (NCWC) 2,030,428,000
Change in NCWC 281,592,000
EBIT 283,231,000
Tax Provision 53,074,000
Depreciation and Amortization 21,326,000
Capital Expenditure -27,166,000
Unlevered Free Cash Flow 502,011,333
Current Assets 2,642,835,000
Current Cash 522,591,000
Current Liabilities 386,408,000
Current Debt 15,000,000
Non-Cash Working Capital (NCWC) 1,748,836,000
Change in NCWC 79,796,000
EBIT 181,274,000
Tax Provision 87,897,000
Depreciation and Amortization 5,321,000
Capital Expenditure -2,539,000
Unlevered Free Cash Flow 194,495,354
Current Assets 2,339,770,000
Current Cash 318,857,000
Current Liabilities 366,873,000
Current Debt 15,000,000
Non-Cash Working Capital (NCWC) 1,669,040,000
Change in NCWC 6,091,000
EBIT 159,459,000
Tax Provision 48,570,000
Depreciation and Amortization 5,132,000
Capital Expenditure -4,468,000
Unlevered Free Cash Flow 115,187,035
Current Assets 2,203,761,000
Current Cash 236,729,000
Current Liabilities 319,083,000
Current Debt 15,000,000
Non-Cash Working Capital (NCWC) 1,662,949,000
Change in NCWC 88,755,000
EBIT 112,885,000
Tax Provision 35,633,000
Depreciation and Amortization 4,069,000
Capital Expenditure -1,491,000
Unlevered Free Cash Flow 164,558,440
Current Assets 2,106,366,000
Current Cash 263,520,000
Current Liabilities 283,652,000
Current Debt 15,000,000
Non-Cash Working Capital (NCWC) 1,574,194,000
Change in NCWC 246,698,000
EBIT 103,869,000
Tax Provision 37,332,000
Depreciation and Amortization 3,928,000
Capital Expenditure -3,242,000
Unlevered Free Cash Flow 312,659,941
Current Assets 2,331,731,000
Current Cash 717,655,000
Current Liabilities 286,580,000
Current Debt 0
Non-Cash Working Capital (NCWC) 1,327,496,000
Change in NCWC 423,084,000
EBIT 106,455,000
Tax Provision -184,560,000
Depreciation and Amortization 3,864,000
Capital Expenditure -1,785,000
Unlevered Free Cash Flow 531,618,000
Current Assets 1,873,114,000
Current Cash 649,000,000
Current Liabilities 319,702,000
Current Debt 0
Non-Cash Working Capital (NCWC) 904,412,000
Change in NCWC 238,216,000
EBIT 39,402,000
Tax Provision -1,584,000
Depreciation and Amortization 4,766,000
Capital Expenditure -1,268,000
Unlevered Free Cash Flow 281,116,000

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