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Discounted Cash Flow (DCF) Analysis Unlevered


Apple Hospitality REIT Inc.

Apple Hospitality REIT Inc. (APLE)

Real Estate

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 387.99803.88898.331,041.081,238.681,270.631,668.092,189.872,874.863,774.114,954.66
Revenue (%)
EBITDA 179.91145.42278.75333.25407.15441.29542.46712.14934.901,227.341,611.25
EBITDA (%)
EBIT 125.0932.32151.28185.10230.64257.81305.26400.75526.10690.66906.70
EBIT (%)
Depreciation 54.82113.11127.47148.15176.51183.48237.20311.40408.80536.68704.55
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 -----------
Total Cash (%)
Account Receivables 10.4422.9124.7031.4431.4629.1044.8758.9177.33101.52133.28
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable 16.9255.5577.62124.83109.00107.37136.62179.35235.45309.10405.79
Accounts Payable (%)
Capital Expenditure -22.81-58.44-62.25-65.17-63.30-74.33-103.59-135.99-178.53-234.37-307.68
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 16.28
Diluted Shares Outstanding 229.66
Cost of Debt
Tax Rate 0.28
After-tax Cost of Debt 0.04
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.34
Total Debt 1,378.00
Total Equity 3,738.85
Total Capital 5,116.85
Debt Weighting 26.93
Equity Weighting 73.07
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 387.99803.88898.331,041.081,238.681,270.631,668.092,189.872,874.863,774.114,954.66
EBITDA 179.91145.42278.75333.25407.15441.29542.46712.14934.901,227.341,611.25
EBIT 125.0932.32151.28185.10230.64257.81305.26400.75526.10690.66906.70
Tax Rate 1.22%22.37%0.76%0.30%0.46%0.28%4.23%4.23%4.23%4.23%4.23%
EBIAT 123.5625.09150.13184.55229.58257.08292.34383.79503.83661.43868.33
Depreciation 54.82113.11127.47148.15176.51183.48237.20311.40408.80536.68704.55
Accounts Receivable --12.47-1.79-6.74-0.022.36-15.77-14.04-18.43-24.19-31.76
Inventories -----------
Accounts Payable -38.6322.0747.21-15.82-1.6329.2542.7356.1073.6596.69
Capital Expenditure -35.633.812.92-1.8811.0429.2632.4042.5455.8473.31
UFCF 178.39199.98301.69376.09388.37452.32572.27756.29992.851,303.421,711.12
WACC
PV UFCF 529.10646.48784.67952.391,155.97
SUM PV UFCF 3,935.24

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.16
Free cash flow (t + 1) 1,779.57
Terminal Value 42,778.10
Present Value of Terminal Value 28,899.35

Intrinsic Value

Enterprise Value 32,834.59
Net Debt 1,378.00
Equity Value 31,456.59
Shares Outstanding 229.66
Equity Value Per Share 136.97