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Discounted Cash Flow (DCF) Analysis Unlevered


CenturyLink Inc.

CenturyLink Inc. (CTL)

Communication 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 18,095.0018,031.6717,900.0417,470.4417,655.6223,443.1324,866.1326,375.5127,976.5029,674.6731,475.93
Revenue (%)
EBITDA 6,063.636,848.436,816.336,254.425,957.015,734.198,437.088,949.219,492.4310,068.6210,679.78
EBITDA (%)
EBIT 1,521.792,419.852,627.732,337.542,021.57614.212,650.732,811.632,982.293,163.323,355.33
EBIT (%)
Depreciation 4,541.854,428.584,188.613,916.873,935.445,119.985,786.356,137.586,510.136,905.307,324.45
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 168.28128.02125.30223.62586.17518.09380.45403.55428.04454.02481.58
Total Cash (%)
Account Receivables 1,977.781,988.891,942.152,017.842,556.532,398.232,862.093,035.823,220.103,415.563,622.88
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable 1,111.031,226.15968.391,179.251,555.461,934.061,745.601,851.561,963.952,083.162,209.61
Accounts Payable (%)
Capital Expenditure -2,967.58-2,984.24-2,840.74-2,950.76-1,576.65-3,017.13-3,627.97-3,848.19-4,081.77-4,329.54-4,592.34
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 13.73
Diluted Shares Outstanding 1,065.87
Cost of Debt
Tax Rate -10.88
After-tax Cost of Debt 0.59
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.76
Total Debt 35,409.00
Total Equity 14,634.34
Total Capital 50,043.34
Debt Weighting 70.76
Equity Weighting 29.24
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 18,095.0018,031.6717,900.0417,470.4417,655.6223,443.1324,866.1326,375.5127,976.5029,674.6731,475.93
EBITDA 6,063.636,848.436,816.336,254.425,957.015,734.198,437.088,949.219,492.4310,068.6210,679.78
EBIT 1,521.792,419.852,627.732,337.542,021.57614.212,650.732,811.632,982.293,163.323,355.33
Tax Rate 206.70%30.45%33.28%38.63%-157.22%-10.88%23.49%23.49%23.49%23.49%23.49%
EBIAT -1,623.701,682.991,753.151,434.615,199.92681.012,027.992,151.092,281.662,420.162,567.06
Depreciation 4,541.854,428.584,188.613,916.873,935.445,119.985,786.356,137.586,510.136,905.307,324.45
Accounts Receivable --11.1146.74-75.68-538.70158.30-463.86-173.73-184.27-195.46-207.32
Inventories -----------
Accounts Payable -115.12-257.76210.86376.21378.60-188.46105.96112.39119.21126.45
Capital Expenditure -16.66-143.51110.02-1,374.111,440.48610.84220.22233.58247.76262.80
UFCF 2,918.156,232.245,587.235,596.687,598.767,778.387,772.868,441.128,953.509,496.9710,073.44
WACC
PV UFCF 7,299.837,444.997,416.327,387.767,359.32
SUM PV UFCF 53,430.22

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.48
Free cash flow (t + 1) 10,476.38
Terminal Value 422,434.52
Present Value of Terminal Value 308,616.53

Intrinsic Value

Enterprise Value 362,046.75
Net Debt 34,890.91
Equity Value 327,155.84
Shares Outstanding 1,065.87
Equity Value Per Share 306.94