C3
DCF Lab
Value a company from its free cash flow, to the firm or to equity, on the case forecast or in stages, and see how much rests on the terminal value.
Learning focus: FCFF at WACC and FCFE at the required return value the same company two ways, and most of either answer usually sits in the terminal value.
Case file
%
%
Changes here carry to the other valuation tools. Your case stays in this browser. Sign in to save it to your account.
Cash flow model
Value per share
$47.33
Equity value
$4,597.9m
Terminal value share
81.1%
Required return
8.00%
Net debt
$879.2m
Price
$44.50
value is 6.4% from price
Cash flows
| Year | FCFE ($m) | Present value |
|---|---|---|
| F1 | 203.7 | 188.6 |
| F2 | 211.2 | 181.1 |
| F3 | 218.3 | 173.3 |
| F4 | 226.1 | 166.2 |
| F5 | 234.1 | 159.3 |
Value per share: required return against terminal growth
| r \ g | 2.50% | 3.00% | 3.50% | 4.00% | 4.50% |
|---|---|---|---|---|---|
| 7.00% | 51.63 | 55.69 | 60.90 | 67.84 | 77.57 |
| 7.50% | 46.39 | 49.44 | 53.27 | 58.18 | 64.74 |
| 8.00% | 42.09 | 44.45 | 47.33 | 50.93 | 55.57 |
| 8.50% | 38.52 | 40.37 | 42.58 | 45.30 | 48.69 |
| 9.00% | 35.49 | 36.96 | 38.70 | 40.79 | 43.34 |
The shaded cell is the case. With FCFF, WACC moves with the required return.