Discounted Cash Flow (DCF) Analysis Levered
Microsoft Corp (MSFT)
$231.6
4.87 (+2.15%)
Free Cash Flow
Year A/P | 2013 Actual | 2014 Actual | 2015 Actual | 2016 Actual | 2017 Actual | 2018 Actual | 2019 Actual | 2020 Actual | 2021 Projected | 2022 Projected | 2023 Projected | 2024 Projected | 2025 Projected |
| Revenue | 77,849.00 | 86,833.00 | 93,580.00 | 85,320.00 | 89,950.00 | 110,360.00 | 125,843.00 | 143,015.00 | 156,555.63 | 171,378.28 | 187,604.33 | 205,366.66 | 224,810.73 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (%) | |||||||||||||
| Operating Cash Flow | 28,833.00 | 32,231.00 | 29,080.00 | 33,325.00 | 39,507.00 | 43,884.00 | 52,185.00 | 60,675.00 | 61,031.01 | 66,809.41 | 73,134.91 | 80,059.30 | 87,639.30 |
| Operating Cash Flow (%) | |||||||||||||
| Capital Expenditure | -4,257.00 | -5,485.00 | -5,944.00 | -8,343.00 | -8,129.00 | -11,632.00 | -13,925.00 | -15,441.00 | -13,572.34 | -14,857.36 | -16,264.05 | -17,803.93 | -19,489.60 |
| Capital Expenditure (%) | |||||||||||||
| Free Cash Flow | 24,576.00 | 26,746.00 | 23,136.00 | 24,982.00 | 31,378.00 | 32,252.00 | 38,260.00 | 45,234.00 | 47,458.67 | 51,952.05 | 56,870.86 | 62,255.37 | 68,149.70 |
Weighted Average Cost Of Capital
| Share price | $ 231.6 |
|---|---|
| Beta | 0.855 |
| Diluted Shares Outstanding | 7,683.00 |
| Cost of Debt | |
| Tax Rate | 16.51 |
| After-tax Cost of Debt | 4.17% |
| Risk-Free Rate | |
| Market Risk Premium | |
| Cost of Equity | 9.267 |
| Total Debt | 63,327.00 |
| Total Equity | 1,779,382.80 |
| Total Capital | 1,842,709.80 |
| Debt Weighting | 3.44 |
| Equity Weighting | 96.56 |
| Wacc |
Build Up Free Cash Flow
Year A/P | 2013 Actual | 2014 Actual | 2015 Actual | 2016 Actual | 2017 Actual | 2018 Actual | 2019 Actual | 2020 Actual | 2021 Projected | 2022 Projected | 2023 Projected | 2024 Projected | 2025 Projected |
| Revenue | 77,849.00 | 86,833.00 | 93,580.00 | 85,320.00 | 89,950.00 | 110,360.00 | 125,843.00 | 143,015.00 | 156,555.63 | 171,378.28 | 187,604.33 | 205,366.66 | 224,810.73 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating Cash Flow | 28,833.00 | 32,231.00 | 29,080.00 | 33,325.00 | 39,507.00 | 43,884.00 | 52,185.00 | 60,675.00 | 61,031.01 | 66,809.41 | 73,134.91 | 80,059.30 | 87,639.30 |
| Capital Expenditure | -4,257.00 | -5,485.00 | -5,944.00 | -8,343.00 | -8,129.00 | -11,632.00 | -13,925.00 | -15,441.00 | -13,572.34 | -14,857.36 | -16,264.05 | -17,803.93 | -19,489.60 |
| Free Cash Flow | 24,576.00 | 26,746.00 | 23,136.00 | 24,982.00 | 31,378.00 | 32,252.00 | 38,260.00 | 45,234.00 | 47,458.67 | 51,952.05 | 56,870.86 | 62,255.37 | 68,149.70 |
| WACC | |||||||||||||
| PV LFCF | 43,504.15 | 43,654.88 | 43,806.13 | 43,957.91 | 44,110.22 | ||||||||
| SUM PV LFCF | 219,033.29 |
Terminal Value
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 9.09 |
| Free cash flow (t + 1) | 70,875.69 |
| Terminal Value | 1,392,449.62 |
| Present Value of Terminal Value | 901,269.73 |
Intrinsic Value
| Enterprise Value | 1,120,303.02 |
|---|---|
| Net Debt | 49,751.00 |
| Equity Value | 1,070,552.02 |
| Shares Outstanding | 7,683.00 |
| Equity Value Per Share | 139.34 |