DCF Tool

RIO

Rio Tinto plc – Iron Ore Mining
Analysis Results
Intrinsic Value $856.84
Latest Price $69.54
Relative Value 92% 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 24.5%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 6.2%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 24.5%, 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 22.8 21.4
2023 28.3 25.1
2024 35.3 29.4
2025 43.9 34.5
2026 54.6 40.4
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 1320 billion. This corresponds to a present value of 920 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 151 billion. Adding in the terminal value gives a total present value of 1070 billion.

There are presently 1.25 billion outstanding shares, so the intrinsic value per share is 856.84.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 24,432,000,000
Current Cash 12,826,000,000
Current Liabilities 12,627,000,000
Current Debt 1,381,000,000
Non-Cash Working Capital (NCWC) 360,000,000
Change in NCWC 355,000,000
EBIT 31,128,000,000
Tax Provision 8,258,000,000
Depreciation and Amortization 4,697,000,000
Capital Expenditure -7,384,000,000
Unlevered Free Cash Flow 20,458,990,172
Current Assets 21,386,000,000
Current Cash 10,381,000,000
Current Liabilities 11,607,000,000
Current Debt 607,000,000
Non-Cash Working Capital (NCWC) 5,000,000
Change in NCWC 482,000,000
EBIT 18,385,000,000
Tax Provision 4,991,000,000
Depreciation and Amortization 4,279,000,000
Capital Expenditure -6,189,000,000
Unlevered Free Cash Flow 10,995,104,411
Current Assets 17,303,000,000
Current Cash 8,027,000,000
Current Liabilities 11,125,000,000
Current Debt 1,372,000,000
Non-Cash Working Capital (NCWC) -477,000,000
Change in NCWC 2,230,000,000
EBIT 15,545,000,000
Tax Provision 4,147,000,000
Depreciation and Amortization 4,384,000,000
Capital Expenditure -5,488,000,000
Unlevered Free Cash Flow 10,873,256,048
Current Assets 20,168,000,000
Current Cash 13,377,000,000
Current Liabilities 10,571,000,000
Current Debt 1,073,000,000
Non-Cash Working Capital (NCWC) -2,707,000,000
Change in NCWC 541,000,000
EBIT 13,148,000,000
Tax Provision 4,242,000,000
Depreciation and Amortization 4,015,000,000
Capital Expenditure -5,430,000,000
Unlevered Free Cash Flow 9,203,938,019
Current Assets 18,678,000,000
Current Cash 11,605,000,000
Current Liabilities 11,225,000,000
Current Debt 904,000,000
Non-Cash Working Capital (NCWC) -3,248,000,000
Change in NCWC -1,073,000,000
EBIT 12,987,000,000
Tax Provision 3,965,000,000
Depreciation and Amortization 4,375,000,000
Capital Expenditure -4,482,000,000
Unlevered Free Cash Flow 7,789,096,207
Current Assets 15,055,000,000
Current Cash 8,536,000,000
Current Liabilities 9,362,000,000
Current Debt 668,000,000
Non-Cash Working Capital (NCWC) -2,175,000,000
Change in NCWC -341,000,000
EBIT 6,888,000,000
Tax Provision 1,567,000,000
Depreciation and Amortization 4,794,000,000
Capital Expenditure -3,012,000,000
Unlevered Free Cash Flow 6,627,361,027
Current Assets 15,554,000,000
Current Cash 9,447,000,000
Current Liabilities 10,157,000,000
Current Debt 2,216,000,000
Non-Cash Working Capital (NCWC) -1,834,000,000
Change in NCWC -859,000,000
EBIT 6,440,000,000
Tax Provision 993,000,000
Depreciation and Amortization 4,645,000,000
Capital Expenditure -4,685,000,000
Unlevered Free Cash Flow 5,541,000,000
Current Assets 21,512,000,000
Current Cash 12,519,000,000
Current Liabilities 12,580,000,000
Current Debt 2,612,000,000
Non-Cash Working Capital (NCWC) -975,000,000
Change in NCWC -1,379,000,000
EBIT 13,562,000,000
Tax Provision 3,053,000,000
Depreciation and Amortization 4,860,000,000
Capital Expenditure -8,162,000,000
Unlevered Free Cash Flow 4,261,476,849
Current Assets 22,283,000,000
Current Cash 10,338,000,000
Current Liabilities 15,380,000,000
Current Debt 3,839,000,000
Non-Cash Working Capital (NCWC) 404,000,000
Change in NCWC -441,000,000
EBIT 14,760,000,000
Tax Provision 2,426,000,000
Depreciation and Amortization 4,791,000,000
Capital Expenditure -13,001,000,000
Unlevered Free Cash Flow -3,514,155,065
Current Assets 20,210,000,000
Current Cash 7,153,000,000
Current Liabilities 14,345,000,000
Current Debt 2,133,000,000
Non-Cash Working Capital (NCWC) 845,000,000
Change in NCWC 5,422,000,000
EBIT 12,512,000,000
Tax Provision 429,000,000
Depreciation and Amortization 4,441,000,000
Capital Expenditure -17,458,000,000
Unlevered Free Cash Flow 4,917,000,000

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