|Relative Value||56% undervalued|
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 31.8%.
The calculated WACC is 13.1%. This value is used as the default discount rate.
Assuming a growth rate of 31.8%, 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)|
Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 1010 billion. This corresponds to a present value of 482 billion.
The total present value of the projected cash flows is 223 billion. Adding in the terminal value gives a total present value of 706 billion.
There are presently 2.69 billion outstanding shares, so the intrinsic value per share is 262.43.
The following data was to determine the past cash flows.
|Non-Cash Working Capital (NCWC)||-2,467,000,000|
|Change in NCWC||-1,202,000,000|
|Depreciation and Amortization||7,967,000,000|
|Unlevered Free Cash Flow||27,125,874,333|
|Non-Cash Working Capital (NCWC)||-1,265,000,000|
|Change in NCWC||2,141,000,000|
|Depreciation and Amortization||6,862,000,000|
|Unlevered Free Cash Flow||22,586,883,845|
|Non-Cash Working Capital (NCWC)||-3,406,000,000|
|Change in NCWC||-6,255,000,000|
|Depreciation and Amortization||5,741,000,000|
|Unlevered Free Cash Flow||2,253,628,002|
|Non-Cash Working Capital (NCWC)||2,849,000,000|
|Change in NCWC||-243,000,000|
|Depreciation and Amortization||4,315,000,000|
|Unlevered Free Cash Flow||11,878,393,320|
|Non-Cash Working Capital (NCWC)||3,092,000,000|
|Change in NCWC||1,015,000,000|
|Depreciation and Amortization||3,025,000,000|
|Unlevered Free Cash Flow||12,938,475,284|
|Non-Cash Working Capital (NCWC)||2,077,000,000|
|Change in NCWC||777,000,000|
|Depreciation and Amortization||2,342,000,000|
|Unlevered Free Cash Flow||8,770,727,192|
|Non-Cash Working Capital (NCWC)||1,300,000,000|
|Change in NCWC||139,000,000|
|Depreciation and Amortization||1,945,000,000|
|Unlevered Free Cash Flow||3,267,457,862|
|Non-Cash Working Capital (NCWC)||1,161,000,000|
|Change in NCWC||401,000,000|
|Depreciation and Amortization||1,243,000,000|
|Unlevered Free Cash Flow||2,803,297,352|
|Non-Cash Working Capital (NCWC)||760,000,000|
|Change in NCWC||-194,000,000|
|Depreciation and Amortization||1,011,000,000|
|Unlevered Free Cash Flow||982,233,115|
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