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Discounted Cash Flow (DCF) Analysis Levered


Markel Corporation

Markel Corporation (MKL)

Financial Services

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 4,323.085,133.665,369.815,611.996,061.516,841.027,508.028,240.059,043.459,925.1910,892.90
Revenue (%)
Operating Cash Flow 745.73716.66651.36534.82858.31892.751,002.321,100.051,207.301,325.011,454.20
Operating Cash Flow (%)
Capital Expenditure -47.55-82.14-80.01-63.42-74.56-106.72-101.36-111.24-122.09-133.99-147.05
Capital Expenditure (%)
Free Cash Flow 698.18634.52571.35471.41783.75786.03900.96988.811,085.211,191.021,307.15

Weighted Average Cost Of Capital

Share price $ 1,154.97
Diluted Shares Outstanding 13.88
Cost of Debt
Tax Rate -2,155.90
After-tax Cost of Debt 107.84
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.24
Total Debt 2,721.00
Total Equity 16,036.35
Total Capital 18,757.35
Debt Weighting 14.51
Equity Weighting 85.49
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 4,323.085,133.665,369.815,611.996,061.516,841.027,508.028,240.059,043.459,925.1910,892.90
Operating Cash Flow 745.73716.66651.36534.82858.31892.751,002.321,100.051,207.301,325.011,454.20
Capital Expenditure -47.55-82.14-80.01-63.42-74.56-106.72-101.36-111.24-122.09-133.99-147.05
Free Cash Flow 698.18634.52571.35471.41783.75786.03900.96988.811,085.211,191.021,307.15
WACC
PV LFCF 725.06640.40565.62499.57441.23
SUM PV LFCF 2,726.56

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 24.26
Free cash flow (t + 1) 5,307.73
Terminal Value 26,198.08
Present Value of Terminal Value 8,843.27

Intrinsic Value

Enterprise Value 13,640.99
Net Debt -752.87
Equity Value 14,393.86
Shares Outstanding 13.88
Equity Value Per Share 413.72