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Discounted Cash Flow (DCF) Analysis Unlevered


Cenovus Energy Inc

Cenovus Energy Inc (CVE)

Energy

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 17,534.7716,903.528,336.828,189.2613,388.6115,441.0916,143.6616,878.1917,646.1518,449.0519,288.48
Revenue (%)
EBITDA 3,247.443,086.582,233.43744.404,704.76-682.502,781.552,908.113,040.433,178.773,323.41
EBITDA (%)
EBIT 1,525.531,411.44704.46-370.153,110.18-2,260.58795.88832.09869.96909.54950.92
EBIT (%)
Depreciation 1,721.911,675.141,528.971,114.561,594.581,578.081,985.672,076.022,170.482,269.232,372.48
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 2,304.07760.662,967.912,767.97479.31579.042,539.402,654.942,775.742,902.043,034.08
Total Cash (%)
Account Receivables 1,760.491,360.73904.541,367.611,437.94917.201,677.331,753.641,833.441,916.862,004.07
Account Receivables (%)
Inventories 1,183.601,053.09586.08920.471,091.17750.441,191.401,245.611,302.291,361.541,423.49
Inventories (%)
Accounts Payable 4,194.322,227.881,230.511,686.172,063.191,357.272,600.742,719.082,842.802,972.143,107.37
Accounts Payable (%)
Capital Expenditure -3,072.09-2,631.88-1,239.68-768.97-1,312.08-1,020.66-1,984.06-2,074.33-2,168.71-2,267.39-2,370.55
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 9.41
Diluted Shares Outstanding 910.21
Cost of Debt
Tax Rate 27.45
After-tax Cost of Debt -1.32
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.10
Total Debt 6,282.96
Total Equity 8,565.12
Total Capital 14,848.08
Debt Weighting 42.31
Equity Weighting 57.69
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 17,534.7716,903.528,336.828,189.2613,388.6115,441.0916,143.6616,878.1917,646.1518,449.0519,288.48
EBITDA 3,247.443,086.582,233.43744.404,704.76-682.502,781.552,908.113,040.433,178.773,323.41
EBIT 1,525.531,411.44704.46-370.153,110.18-2,260.58795.88832.09869.96909.54950.92
Tax Rate 39.49%37.74%-4.04%38.63%-1.57%27.45%22.95%22.95%22.95%22.95%22.95%
EBIAT 923.12878.76732.92-227.183,158.98-1,639.98613.23641.13670.30700.80732.69
Depreciation 1,721.911,675.141,528.971,114.561,594.581,578.081,985.672,076.022,170.482,269.232,372.48
Accounts Receivable -399.76456.19-463.06-70.33520.74-760.13-76.32-79.79-83.42-87.22
Inventories -130.51467.01-334.39-170.70340.74-440.97-54.21-56.68-59.25-61.95
Accounts Payable --1,966.43-997.37455.65377.02-705.911,243.47118.33123.72129.35135.23
Capital Expenditure --440.21-1,392.19-470.71543.11-291.43963.4090.2794.3898.68103.17
UFCF 2,645.04677.51795.5374.865,432.66-197.773,604.682,795.232,922.413,055.383,194.40
WACC
PV UFCF 3,375.802,451.532,400.342,350.212,301.12
SUM PV UFCF 16,250.82

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.78
Free cash flow (t + 1) 3,322.18
Terminal Value 119,502.86
Present Value of Terminal Value 86,085.24

Intrinsic Value

Enterprise Value 102,336.06
Net Debt 5,703.92
Equity Value 96,632.14
Shares Outstanding 910.21
Equity Value Per Share 106.16