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Discounted Cash Flow (DCF) Analysis Unlevered


American Express Company

American Express Company (AXP)

Financial Services

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 31,038.0032,142.9530,828.3133,408.6434,116.9036,986.1338,343.5239,750.7341,209.5842,721.9744,289.87
Revenue (%)
EBITDA 8,907.9110,002.898,980.299,137.268,747.579,416.6710,697.8411,090.4511,497.4711,919.4312,356.87
EBITDA (%)
EBIT 7,886.768,990.387,938.298,041.467,427.258,122.159,390.339,734.9510,092.2310,462.6110,846.59
EBIT (%)
Depreciation 1,021.151,012.501,042.001,095.801,320.321,294.511,307.511,355.501,405.251,456.821,510.28
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 --42,589.3047,139.5860,707.6151,636.3457,208.5359,308.0961,484.6963,741.1866,080.48
Total Cash (%)
Account Receivables 47,183.9746,999.4346,695.6450,072.8656,736.4058,227.2659,006.8461,172.3963,417.4265,744.8468,157.68
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable 10,615.0011,301.4611,822.6611,188.5514,656.6212,253.5013,888.0214,397.7114,926.1115,473.9016,041.79
Accounts Payable (%)
Capital Expenditure -1,005.63-1,195.72-1,341.03-1,376.44-1,061.04-1,309.31-1,411.04-1,462.83-1,516.51-1,572.17-1,629.87
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 120.23
Diluted Shares Outstanding 856.00
Cost of Debt
Tax Rate 14.79
After-tax Cost of Debt -0.69
Risk-Free Rate
Market Risk Premium
Cost of Equity 11.28
Total Debt 47,108.00
Total Equity 102,916.88
Total Capital 150,024.88
Debt Weighting 31.40
Equity Weighting 68.60
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 31,038.0032,142.9530,828.3133,408.6434,116.9036,986.1338,343.5239,750.7341,209.5842,721.9744,289.87
EBITDA 8,907.9110,002.898,980.299,137.268,747.579,416.6710,697.8411,090.4511,497.4711,919.4312,356.87
EBIT 7,886.768,990.387,938.298,041.467,427.258,122.159,390.339,734.9510,092.2310,462.6110,846.59
Tax Rate 32.06%34.55%34.96%33.16%62.99%14.79%35.42%35.42%35.42%35.42%35.42%
EBIAT 5,358.155,884.605,163.195,374.642,748.836,921.136,064.506,287.066,517.806,757.007,004.98
Depreciation 1,021.151,012.501,042.001,095.801,320.321,294.511,307.511,355.501,405.251,456.821,510.28
Accounts Receivable -184.54303.79-3,377.23-6,663.54-1,490.86-779.58-2,165.55-2,245.03-2,327.42-2,412.84
Inventories -----------
Accounts Payable -686.47521.19-634.103,468.07-2,403.111,634.52509.69528.40547.79567.89
Capital Expenditure -190.09145.3135.40-315.40248.27101.7351.7953.6955.6657.70
UFCF 6,379.307,958.197,175.482,494.51558.284,569.948,328.686,038.496,260.106,489.856,728.02
WACC
PV UFCF 7,635.395,075.024,823.324,584.104,356.74
SUM PV UFCF 38,618.36

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 9.08
Free cash flow (t + 1) 6,997.15
Terminal Value 137,739.08
Present Value of Terminal Value 89,193.15

Intrinsic Value

Enterprise Value 127,811.51
Net Debt -4,528.34
Equity Value 132,339.85
Shares Outstanding 856.00
Equity Value Per Share 154.60