MHK Intrinsic Value

MHK

Mohawk Industries, Inc. – Carpet and Rug Mills

mohawk industries is a leading global flooring manufacturer that creates products to enhance residential and commercial spaces around the world. mohawk’s vertically integrated manufacturing and distribution processes provide competitive advantages in the production of carpet, rugs, ceramic tile, laminate, wood, stone and vinyl flooring. our industry-leading innovation has yielded products and technologies that differentiate our brands in the marketplace and satisfy all remodeling and new construction requirements. our brands are among the most recognized in the industry and include american olean, bigelow, daltile, durkan, karastan, lees, marazzi, mohawk, mohawk home, pergo, unilin and quick-step. during the past decade, mohawk has transformed its business from an american carpet manufacturer into the world’s largest flooring company with operations in australia, brazil, canada, china, europe, india, malaysia, mexico, russia and the united states.

Analysis Results

Intrinsic Value	$261.85
Latest Price	$83.92
Relative Value	68% undervalued

Share results:

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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 4.2%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 7.7%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 4.2%, 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)
2023	0.928	0.862
2024	0.967	0.834
2025	1.01	0.807
2026	1.05	0.781
2027	1.09	0.756

Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 19.7 billion. This corresponds to a present value of 12.6 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 4.04 billion. Adding in the terminal value gives a total present value of 16.7 billion.

There are presently 63.7 million outstanding shares, so the intrinsic value per share is 261.85.

Financial Statements

The following data was to determine the past cash flows.

Current Assets	5,895,099,000
Current Cash	667,623,000
Current Liabilities	3,070,285,000
Current Debt	843,362,000
Non-Cash Working Capital (NCWC)	3,000,553,000
Change in NCWC	672,938,000
EBIT	939,988,000
Tax Provision	158,110,000
Depreciation and Amortization	595,464,000
Capital Expenditure	-580,742,000
Unlevered Free Cash Flow	819,452,458

Current Assets	5,238,357,000
Current Cash	591,895,000
Current Liabilities	2,946,355,000
Current Debt	627,508,000
Non-Cash Working Capital (NCWC)	2,327,615,000
Change in NCWC	292,648,000
EBIT	1,335,011,000
Tax Provision	256,445,000
Depreciation and Amortization	591,711,000
Capital Expenditure	-676,120,000
Unlevered Free Cash Flow	1,277,855,617

Current Assets	5,363,654,000
Current Cash	1,340,366,000
Current Liabilities	2,371,248,000
Current Debt	382,927,000
Non-Cash Working Capital (NCWC)	2,034,967,000
Change in NCWC	-608,544,000
EBIT	636,002,000
Tax Provision	68,647,000
Depreciation and Amortization	607,507,000
Capital Expenditure	-425,557,000
Unlevered Free Cash Flow	134,696,207

Current Assets	4,429,457,000
Current Cash	134,785,000
Current Liabilities	2,712,583,000
Current Debt	1,061,422,000
Non-Cash Working Capital (NCWC)	2,643,511,000
Change in NCWC	-237,493,000
EBIT	827,224,000
Tax Provision	4,974,000
Depreciation and Amortization	576,452,000
Capital Expenditure	-545,462,000
Unlevered Free Cash Flow	615,231,520

Current Assets	4,509,296,000
Current Cash	119,050,000
Current Liabilities	3,266,239,000
Current Debt	1,756,997,000
Non-Cash Working Capital (NCWC)	2,881,004,000
Change in NCWC	335,714,000
EBIT	1,095,326,000
Tax Provision	184,346,000
Depreciation and Amortization	521,765,000
Capital Expenditure	-794,110,000
Unlevered Free Cash Flow	966,244,776

Current Assets	4,072,967,000
Current Cash	84,884,000
Current Liabilities	2,655,355,000
Current Debt	1,212,562,000
Non-Cash Working Capital (NCWC)	2,545,290,000
Change in NCWC	518,756,000
EBIT	1,354,173,000
Tax Provision	343,165,000
Depreciation and Amortization	446,672,000
Capital Expenditure	-905,998,000
Unlevered Free Cash Flow	1,060,981,450

Current Assets	3,471,512,000
Current Cash	121,665,000
Current Liabilities	2,718,320,000
Current Debt	1,395,007,000
Non-Cash Working Capital (NCWC)	2,026,534,000
Change in NCWC	100,256,000
EBIT	1,279,943,000
Tax Provision	307,559,000
Depreciation and Amortization	409,467,000
Capital Expenditure	-672,125,000
Unlevered Free Cash Flow	800,362,642

Current Assets	3,249,972,000
Current Cash	81,692,000
Current Liabilities	3,259,028,000
Current Debt	2,017,026,000
Non-Cash Working Capital (NCWC)	1,926,278,000
Change in NCWC	-19,689,000
EBIT	837,566,000
Tax Provision	131,875,000
Depreciation and Amortization	362,647,000
Capital Expenditure	-503,657,000
Unlevered Free Cash Flow	529,370,981

Current Assets	3,132,270,000
Current Cash	97,877,000
Current Liabilities	1,955,814,000
Current Debt	867,388,000
Non-Cash Working Capital (NCWC)	1,945,967,000
Change in NCWC	89,896,000
EBIT	772,796,000
Tax Provision	131,637,000
Depreciation and Amortization	345,570,000
Capital Expenditure	-561,804,000
Unlevered Free Cash Flow	493,227,202

Current Assets	3,085,718,000
Current Cash	54,066,000
Current Liabilities	1,320,811,000
Current Debt	145,230,000
Non-Cash Working Capital (NCWC)	1,856,071,000
Change in NCWC	531,653,000
EBIT	546,931,000
Tax Provision	78,385,000
Depreciation and Amortization	308,871,000
Capital Expenditure	-366,550,000
Unlevered Free Cash Flow	924,688,714

Current Assets	2,550,046,000
Current Cash	477,672,000
Current Liabilities	828,649,000
Current Debt	80,693,000
Non-Cash Working Capital (NCWC)	1,324,418,000
Change in NCWC	-64,300,000
EBIT	379,508,000
Tax Provision	53,599,000
Depreciation and Amortization	280,293,000
Capital Expenditure	-208,294,000
Unlevered Free Cash Flow	320,403,112

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