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Discounted Cash Flow (DCF) Analysis Levered


Huntington Ingalls Industries Inc.

Huntington Ingalls Industries Inc. (HII)

Industrials

Free Cash Flow

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 6,820.006,957.087,020.397,068.137,441.338,176.538,483.158,801.279,131.329,473.749,829.01
Revenue (%)
Operating Cash Flow 235.97715.88827.70822.02814.08914.14838.14869.57902.17936.01971.11
Operating Cash Flow (%)
Capital Expenditure 139.13164.88188.15284.85381.74462.79309.63321.25333.29345.79358.76
Capital Expenditure (%)
Free Cash Flow 375.10880.771,015.851,106.871,195.821,376.931,147.771,190.811,235.471,281.801,329.86

Weighted Average Cost Of Capital

Share price $ 222.83
Diluted Shares Outstanding 43.80
Cost of Debt
Tax Rate 13.90
After-tax Cost of Debt -0.65
Risk-Free Rate
Market Risk Premium
Cost of Equity 12.19
Total Debt 1,283.00
Total Equity 9,759.95
Total Capital 11,042.95
Debt Weighting 11.62
Equity Weighting 88.38
Wacc

Build Up Free Cash Flow

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 6,820.006,957.087,020.397,068.137,441.338,176.538,483.158,801.279,131.329,473.749,829.01
Operating Cash Flow 235.97715.88827.70822.02814.08914.14838.14869.57902.17936.01971.11
Capital Expenditure 139.13164.88188.15284.85381.74462.79309.63321.25333.29345.79358.76
Free Cash Flow 375.10880.771,015.851,106.871,195.821,376.931,147.771,190.811,235.471,281.801,329.86
WACC
PV LFCF 1,031.52961.80896.80836.19779.68
SUM PV LFCF 6,308.79

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 11.27
Free cash flow (t + 1) 984.66
Terminal Value 13,544.10
Present Value of Terminal Value 7,940.71

Intrinsic Value

Enterprise Value 12,677.47
Net Debt 1,042.61
Equity Value 11,634.86
Shares Outstanding 43.80
Equity Value Per Share 374.88