DCF Tool

PSB

PS Business Parks, Inc. – Other Financial Vehicles
PS Business Parks, Inc., a member of the S&P MidCap 400, is a REIT that acquires, develops, owns, and operates commercial properties, primarily multi-tenant industrial, flex, and office space. As of December 31, 2020, the Company wholly owned 27.7 million rentable square feet with approximately 5,000 commercial customers in six states. The Company also held a 95.0% interest in a 395-unit apartment complex and a 98.2% interest in an entity developing a 411-unit multifamily apartment complex.
Analysis Results
Intrinsic Value $281.43
Latest Price $187.44
Relative Value 33% undervalued
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Cash Flow (Millions)
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 3.8%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 5.0%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 3.8%, 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 (million) Present value (million)
2022 254 242
2023 263 239
2024 273 236
2025 284 233
2026 295 231
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 8840 million. This corresponds to a present value of 6590 million.

Intrinsic Value Per Share

The total present value of the projected cash flows is 1180 million. Adding in the terminal value gives a total present value of 7780 million.

There are presently 27.6 million outstanding shares, so the intrinsic value per share is 281.43.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 66,276,000
Current Cash 27,074,000
Current Liabilities 97,151,000
Current Debt 0
Non-Cash Working Capital (NCWC) -57,949,000
Change in NCWC -14,191,000
EBIT 195,264,000
Tax Provision 0
Depreciation and Amortization 93,486,000
Capital Expenditure -83,887,000
Unlevered Free Cash Flow 190,672,000
Current Assets 107,390,000
Current Cash 69,083,000
Current Liabilities 82,065,000
Current Debt 0
Non-Cash Working Capital (NCWC) -43,758,000
Change in NCWC 6,489,000
EBIT 179,270,000
Tax Provision 0
Depreciation and Amortization 96,314,000
Capital Expenditure -52,474,000
Unlevered Free Cash Flow 229,599,000
Current Assets 97,171,000
Current Cash 62,786,000
Current Liabilities 84,632,000
Current Debt 0
Non-Cash Working Capital (NCWC) -50,247,000
Change in NCWC 183,000
EBIT 183,493,000
Tax Provision 0
Depreciation and Amortization 104,249,000
Capital Expenditure -44,643,000
Unlevered Free Cash Flow 243,282,000
Current Assets 72,090,000
Current Cash 37,379,000
Current Liabilities 85,141,000
Current Debt 0
Non-Cash Working Capital (NCWC) -50,430,000
Change in NCWC -4,145,000
EBIT 177,572,000
Tax Provision 0
Depreciation and Amortization 99,242,000
Capital Expenditure -39,846,000
Unlevered Free Cash Flow 232,823,000
Current Assets 148,820,000
Current Cash 114,882,000
Current Liabilities 80,223,000
Current Debt 0
Non-Cash Working Capital (NCWC) -46,285,000
Change in NCWC 657,000
EBIT 172,085,000
Tax Provision 0
Depreciation and Amortization 94,270,000
Capital Expenditure -51,768,000
Unlevered Free Cash Flow 215,244,000
Current Assets 160,344,000
Current Cash 128,629,000
Current Liabilities 78,657,000
Current Debt 0
Non-Cash Working Capital (NCWC) -46,942,000
Change in NCWC -1,444,000
EBIT 149,933,000
Tax Provision 0
Depreciation and Amortization 99,486,000
Capital Expenditure -31,926,000
Unlevered Free Cash Flow 216,049,000
Current Assets 219,473,000
Current Cash 188,912,000
Current Liabilities 76,059,000
Current Debt 0
Non-Cash Working Capital (NCWC) -45,498,000
Change in NCWC -5,481,000
EBIT 133,475,000
Tax Provision 0
Depreciation and Amortization 105,394,000
Capital Expenditure -46,463,000
Unlevered Free Cash Flow 186,925,000
Current Assets 181,355,000
Current Cash 152,467,000
Current Liabilities 68,905,000
Current Debt 0
Non-Cash Working Capital (NCWC) -40,017,000
Change in NCWC 2,751,000
EBIT 125,548,000
Tax Provision 0
Depreciation and Amortization 110,357,000
Capital Expenditure -53,975,000
Unlevered Free Cash Flow 184,681,000
Current Assets 62,632,000
Current Cash 31,481,000
Current Liabilities 73,919,000
Current Debt 0
Non-Cash Working Capital (NCWC) -42,768,000
Change in NCWC -3,397,000
EBIT 130,825,000
Tax Provision 0
Depreciation and Amortization 108,917,000
Capital Expenditure -58,927,000
Unlevered Free Cash Flow 177,418,000
Current Assets 42,966,000
Current Cash 12,883,000
Current Liabilities 69,454,000
Current Debt 0
Non-Cash Working Capital (NCWC) -39,371,000
Change in NCWC -5,017,000
EBIT 114,814,000
Tax Provision 0
Depreciation and Amortization 109,494,000
Capital Expenditure -56,772,000
Unlevered Free Cash Flow 162,519,000

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