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Discounted Cash Flow (DCF) Analysis Unlevered


Applied Materials Inc.

Applied Materials Inc. (AMAT)

Technology

Operating Data

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 7,509.009,072.379,659.3610,825.2414,537.2217,252.7720,439.3524,214.5028,686.9233,985.4040,262.50
Revenue (%)
EBITDA 855.281,917.902,071.932,556.924,336.455,384.594,723.535,595.976,629.557,854.029,304.66
EBITDA (%)
EBIT 445.281,543.211,701.012,168.303,929.414,927.393,957.064,687.935,553.796,579.577,794.82
EBIT (%)
Depreciation 409.99374.69370.92388.63407.04457.20766.48908.041,075.761,274.451,509.84
Depreciation (%)

Balance Sheet Data

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
Total Cash 1,890.773,161.724,964.913,748.787,275.884,030.257,476.728,857.6710,493.6812,431.8614,728.02
Total Cash (%)
Account Receivables 1,633.211,670.221,738.682,278.712,337.582,322.223,705.654,390.095,200.946,161.557,299.59
Account Receivables (%)
Inventories 1,413.191,566.801,833.352,050.302,930.703,721.423,942.754,670.985,533.716,555.787,766.64
Inventories (%)
Accounts Payable 1,648.981,883.421,833.352,255.982,449.522,720.763,922.314,646.765,505.026,521.807,726.37
Accounts Payable (%)
Capital Expenditure -189.98-215.92-215.40-253.31-344.53-622.82-527.34-624.73-740.12-876.82-1,038.77
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 59.11
Diluted Shares Outstanding 1,013.00
Cost of Debt
Tax Rate 29.42
After-tax Cost of Debt -1.42
Risk-Free Rate
Market Risk Premium
Cost of Equity 15.48
Total Debt 5,309.00
Total Equity 59,878.43
Total Capital 65,187.43
Debt Weighting 8.14
Equity Weighting 91.86
Wacc

Build Up Free Cash

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 7,509.009,072.379,659.3610,825.2414,537.2217,252.7720,439.3524,214.5028,686.9233,985.4040,262.50
EBITDA 855.281,917.902,071.932,556.924,336.455,384.594,723.535,595.976,629.557,854.029,304.66
EBIT 445.281,543.211,701.012,168.303,929.414,927.393,957.064,687.935,553.796,579.577,794.82
Tax Rate 26.86%25.97%13.83%14.51%7.96%29.42%19.76%19.76%19.76%19.76%19.76%
EBIAT 325.691,142.491,465.771,853.773,616.623,477.733,175.273,761.754,456.545,279.666,254.82
Depreciation 409.99374.69370.92388.63407.04457.20766.48908.041,075.761,274.451,509.84
Accounts Receivable --37.02-68.46-540.03-58.8715.36-1,383.43-684.43-810.85-960.61-1,138.04
Inventories --153.61-266.55-216.95-880.40-790.72-221.33-728.23-862.73-1,022.08-1,210.85
Accounts Payable -234.45-50.08422.63193.54271.241,201.55724.45858.261,016.781,204.58
Capital Expenditure -25.94-0.5237.9191.22278.29-95.4997.40115.39136.70161.95
UFCF 735.681,586.951,451.081,945.953,369.153,709.103,443.054,078.984,832.375,724.916,782.30
WACC
PV UFCF 3,006.773,110.753,218.323,329.623,444.77
SUM PV UFCF 14,452.90

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 14.51
Free cash flow (t + 1) 7,053.59
Terminal Value 67,113.10
Present Value of Terminal Value 34,087.12

Intrinsic Value

Enterprise Value 48,540.02
Net Debt 1,278.75
Equity Value 47,261.27
Shares Outstanding 1,013.00
Equity Value Per Share 46.65