DCF Tool

PPG

PPG Industries, Inc. – Paint and Coating Manufacturing
PPG works every day to develop and deliver the paints, coatings and materials that its customers have trusted for more than 135 years. Through dedication and creativity, it solves its customers' biggest challenges, collaborating closely to find the right path forward. With headquarters in Pittsburgh, it operates and innovate in more than 70 countries and reported net sales of $13.8 billion in 2020. It serves customers in construction, consumer products, industrial and transportation markets and aftermarkets.
Analysis Results
Intrinsic Value $162.08
Latest Price $119.68
Relative Value 26% 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 3.4%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 6.8%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 3.4%, 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 1.85 1.74
2023 1.92 1.68
2024 1.98 1.63
2025 2.05 1.58
2026 2.12 1.52
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 44.8 billion. This corresponds to a present value of 30.1 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 8.14 billion. Adding in the terminal value gives a total present value of 38.3 billion.

There are presently 236.0 million outstanding shares, so the intrinsic value per share is 162.08.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 6,774,000,000
Current Cash 1,072,000,000
Current Liabilities 4,766,000,000
Current Debt 9,000,000
Non-Cash Working Capital (NCWC) 945,000,000
Change in NCWC 322,000,000
EBIT 1,759,000,000
Tax Provision 374,000,000
Depreciation and Amortization 561,000,000
Capital Expenditure -371,000,000
Unlevered Free Cash Flow 1,908,539,393
Current Assets 6,798,000,000
Current Cash 1,922,000,000
Current Liabilities 4,831,000,000
Current Debt 578,000,000
Non-Cash Working Capital (NCWC) 623,000,000
Change in NCWC -412,000,000
EBIT 1,795,000,000
Tax Provision 291,000,000
Depreciation and Amortization 509,000,000
Capital Expenditure -304,000,000
Unlevered Free Cash Flow 1,204,486,784
Current Assets 6,170,000,000
Current Cash 1,273,000,000
Current Liabilities 4,375,000,000
Current Debt 513,000,000
Non-Cash Working Capital (NCWC) 1,035,000,000
Change in NCWC -241,000,000
EBIT 1,965,000,000
Tax Provision 392,000,000
Depreciation and Amortization 511,000,000
Capital Expenditure -413,000,000
Unlevered Free Cash Flow 1,358,255,267
Current Assets 5,961,000,000
Current Cash 963,000,000
Current Liabilities 4,373,000,000
Current Debt 651,000,000
Non-Cash Working Capital (NCWC) 1,276,000,000
Change in NCWC 173,000,000
EBIT 1,888,000,000
Tax Provision 353,000,000
Depreciation and Amortization 497,000,000
Capital Expenditure -411,000,000
Unlevered Free Cash Flow 1,753,341,405
Current Assets 6,477,000,000
Current Cash 1,491,000,000
Current Liabilities 3,895,000,000
Current Debt 12,000,000
Non-Cash Working Capital (NCWC) 1,103,000,000
Change in NCWC 125,000,000
EBIT 2,087,000,000
Tax Provision 615,000,000
Depreciation and Amortization 460,000,000
Capital Expenditure -360,000,000
Unlevered Free Cash Flow 1,671,847,880
Current Assets 6,452,000,000
Current Cash 1,863,000,000
Current Liabilities 4,240,000,000
Current Debt 629,000,000
Non-Cash Working Capital (NCWC) 978,000,000
Change in NCWC 256,000,000
EBIT 2,125,000,000
Tax Provision 241,000,000
Depreciation and Amortization 462,000,000
Capital Expenditure -402,000,000
Unlevered Free Cash Flow 1,821,743,651
Current Assets 6,554,000,000
Current Cash 1,459,000,000
Current Liabilities 4,656,000,000
Current Debt 283,000,000
Non-Cash Working Capital (NCWC) 722,000,000
Change in NCWC -545,000,000
EBIT 2,129,000,000
Tax Provision 456,000,000
Depreciation and Amortization 495,000,000
Capital Expenditure -476,000,000
Unlevered Free Cash Flow 1,087,153,028
Current Assets 6,850,000,000
Current Cash 1,188,000,000
Current Liabilities 4,876,000,000
Current Debt 481,000,000
Non-Cash Working Capital (NCWC) 1,267,000,000
Change in NCWC -96,000,000
EBIT 1,994,000,000
Tax Provision 259,000,000
Depreciation and Amortization 476,000,000
Capital Expenditure -587,000,000
Unlevered Free Cash Flow 1,422,278,248
Current Assets 7,214,000,000
Current Cash 1,750,000,000
Current Liabilities 4,135,000,000
Current Debt 34,000,000
Non-Cash Working Capital (NCWC) 1,363,000,000
Change in NCWC -135,000,000
EBIT 1,850,000,000
Tax Provision 333,000,000
Depreciation and Amortization 475,000,000
Capital Expenditure -515,000,000
Unlevered Free Cash Flow 1,261,265,950
Current Assets 7,715,000,000
Current Cash 2,398,000,000
Current Liabilities 4,461,000,000
Current Debt 642,000,000
Non-Cash Working Capital (NCWC) 1,498,000,000
Change in NCWC -120,000,000
EBIT 1,938,000,000
Tax Provision 338,000,000
Depreciation and Amortization 465,000,000
Capital Expenditure -411,000,000
Unlevered Free Cash Flow 1,404,778,887

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