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Trane Technologies plc – Automatic Environmental Control Manufacturing for Residential, Commercial, and Appliance Use
Trane Technologies is a global climate innovator. Through its strategic brands Trane and Thermo King, and its portfolio of environmentally responsible products and services, company brings efficient and sustainable climate solutions to buildings, homes and transportation.
Analysis Results
Intrinsic Value $311.22
Latest Price $144.81
Relative Value 53% 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 13.7%.

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 13.7%, 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 2.94 2.73
2023 3.35 2.89
2024 3.81 3.05
2025 4.33 3.22
2026 4.93 3.4
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 88.5 billion. This corresponds to a present value of 56.8 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 15.3 billion. Adding in the terminal value gives a total present value of 72.1 billion.

There are presently 232.0 million outstanding shares, so the intrinsic value per share is 311.22.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 12,941,800,000
Current Cash 4,318,400,000
Current Liabilities 9,504,800,000
Current Debt 700,800,000
Non-Cash Working Capital (NCWC) -180,600,000
Change in NCWC -233,000,000
EBIT 4,046,600,000
Tax Provision 667,000,000
Depreciation and Amortization 598,800,000
Capital Expenditure -446,000,000
Unlevered Free Cash Flow 3,212,761,143
Current Assets 6,905,600,000
Current Cash 3,289,900,000
Current Liabilities 4,338,900,000
Current Debt 775,600,000
Non-Cash Working Capital (NCWC) 52,400,000
Change in NCWC -649,800,000
EBIT 1,532,800,000
Tax Provision 296,800,000
Depreciation and Amortization 294,300,000
Capital Expenditure -146,200,000
Unlevered Free Cash Flow 677,944,403
Current Assets 6,217,200,000
Current Cash 1,303,600,000
Current Liabilities 4,861,900,000
Current Debt 650,500,000
Non-Cash Working Capital (NCWC) 702,200,000
Change in NCWC -161,300,000
EBIT 2,017,600,000
Tax Provision 353,700,000
Depreciation and Amortization 397,400,000
Capital Expenditure -254,100,000
Unlevered Free Cash Flow 1,589,847,404
Current Assets 5,732,000,000
Current Cash 903,400,000
Current Liabilities 4,315,700,000
Current Debt 350,600,000
Non-Cash Working Capital (NCWC) 863,500,000
Change in NCWC 14,800,000
EBIT 1,917,400,000
Tax Provision 281,300,000
Depreciation and Amortization 361,500,000
Capital Expenditure -365,600,000
Unlevered Free Cash Flow 1,603,240,263
Current Assets 6,119,100,000
Current Cash 1,549,400,000
Current Liabilities 4,828,000,000
Current Debt 1,107,000,000
Non-Cash Working Capital (NCWC) 848,700,000
Change in NCWC 213,600,000
EBIT 1,665,300,000
Tax Provision 80,200,000
Depreciation and Amortization 353,300,000
Capital Expenditure -221,300,000
Unlevered Free Cash Flow 1,916,706,432
Current Assets 5,579,300,000
Current Cash 1,714,700,000
Current Liabilities 3,590,300,000
Current Debt 360,800,000
Non-Cash Working Capital (NCWC) 635,100,000
Change in NCWC -93,300,000
EBIT 1,572,300,000
Tax Provision 281,500,000
Depreciation and Amortization 352,200,000
Capital Expenditure -182,700,000
Unlevered Free Cash Flow 1,394,320,679
Current Assets 4,609,400,000
Current Cash 736,800,000
Current Liabilities 3,648,400,000
Current Debt 504,200,000
Non-Cash Working Capital (NCWC) 728,400,000
Change in NCWC -90,900,000
EBIT 1,458,000,000
Tax Provision 540,800,000
Depreciation and Amortization 364,100,000
Capital Expenditure -249,600,000
Unlevered Free Cash Flow 849,749,370
Current Assets 5,707,900,000
Current Cash 1,705,200,000
Current Liabilities 3,666,100,000
Current Debt 482,700,000
Non-Cash Working Capital (NCWC) 819,300,000
Change in NCWC 80,700,000
EBIT 1,412,500,000
Tax Provision 293,700,000
Depreciation and Amortization 332,400,000
Capital Expenditure -233,500,000
Unlevered Free Cash Flow 1,249,077,633
Current Assets 5,716,700,000
Current Cash 1,937,200,000
Current Liabilities 3,408,600,000
Current Debt 367,700,000
Non-Cash Working Capital (NCWC) 738,600,000
Change in NCWC -124,400,000
EBIT 1,102,400,000
Tax Provision 189,000,000
Depreciation and Amortization 333,700,000
Capital Expenditure -242,200,000
Unlevered Free Cash Flow 818,350,530
Current Assets 4,942,700,000
Current Cash 882,100,000
Current Liabilities 4,161,300,000
Current Debt 963,700,000
Non-Cash Working Capital (NCWC) 863,000,000
Change in NCWC 202,300,000
EBIT 1,494,800,000
Tax Provision 227,000,000
Depreciation and Amortization 375,500,000
Capital Expenditure -262,600,000
Unlevered Free Cash Flow 1,544,221,351

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