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Discounted Cash Flow (DCF) Analysis Unlevered


CVS Health Corporation

CVS Health Corporation (CVS)

Healthcare

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 126,761.00139,361.04153,283.21177,532.62184,775.95194,569.07212,138.66231,294.78252,180.70274,952.62299,780.84
Revenue (%)
EBITDA 9,900.0310,201.2311,557.5512,178.7411,807.186,751.5513,916.3015,172.9416,543.0518,036.8919,665.62
EBITDA (%)
EBIT 8,023.978,264.119,472.909,711.039,331.194,027.5810,967.5711,957.9413,037.7414,215.0515,498.67
EBIT (%)
Depreciation 1,876.061,937.122,084.652,467.702,476.002,723.972,948.733,215.003,505.313,821.844,166.95
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 4,183.112,508.502,544.503,461.891,810.806,576.434,624.625,042.235,497.545,993.976,535.22
Total Cash (%)
Account Receivables 8,733.839,685.5911,894.7812,160.9813,174.5217,627.9615,783.1217,208.3318,762.2420,456.4722,303.69
Account Receivables (%)
Inventories 11,040.8811,929.3113,994.7614,752.9615,299.4516,441.0918,201.5019,845.0921,637.1023,590.9325,721.20
Inventories (%)
Accounts Payable 10,090.1811,957.1815,144.3817,398.208,869.258,930.7216,122.5417,578.4019,165.7320,896.4022,783.34
Accounts Payable (%)
Capital Expenditure -1,926.77-2,118.29-2,329.90-2,219.16-1,921.67-2,042.98-2,800.23-3,053.09-3,328.79-3,629.37-3,957.11
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 61.64
Diluted Shares Outstanding 1,044.00
Cost of Debt
Tax Rate 142.19
After-tax Cost of Debt -7.06
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.89
Total Debt 71,444.00
Total Equity 64,352.16
Total Capital 135,796.16
Debt Weighting 52.61
Equity Weighting 47.39
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 126,761.00139,361.04153,283.21177,532.62184,775.95194,569.07212,138.66231,294.78252,180.70274,952.62299,780.84
EBITDA 9,900.0310,201.2311,557.5512,178.7411,807.186,751.5513,916.3015,172.9416,543.0518,036.8919,665.62
EBIT 8,023.978,264.119,472.909,711.039,331.194,027.5810,967.5711,957.9413,037.7414,215.0515,498.67
Tax Rate 38.94%39.51%39.27%38.42%19.82%142.19%53.02%53.02%53.02%53.02%53.02%
EBIAT 4,899.744,999.165,753.175,980.267,481.67-1,699.145,152.255,617.506,124.766,677.837,280.83
Depreciation 1,876.061,937.122,084.652,467.702,476.002,723.972,948.733,215.003,505.313,821.844,166.95
Accounts Receivable --951.76-2,209.18-266.21-1,013.54-4,453.431,844.84-1,425.22-1,553.91-1,694.23-1,847.22
Inventories --888.42-2,065.45-758.20-546.49-1,141.64-1,760.41-1,643.60-1,792.01-1,953.83-2,130.26
Accounts Payable -1,867.003,187.202,253.82-8,528.9561.477,191.821,455.871,587.331,730.671,886.94
Capital Expenditure -191.52211.62-110.75-297.49121.31757.26252.86275.69300.59327.73
UFCF 6,775.817,154.626,962.019,566.62-428.80-4,387.4616,134.487,472.418,147.178,882.869,684.98
WACC
PV UFCF 15,576.836,964.817,331.277,717.018,123.05
SUM PV UFCF 60,889.24

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 3.58
Free cash flow (t + 1) 10,072.38
Terminal Value -2,398,186.59
Present Value of Terminal Value -2,011,423.11

Intrinsic Value

Enterprise Value -1,950,533.87
Net Debt 64,867.57
Equity Value -2,015,401.44
Shares Outstanding 1,044.00
Equity Value Per Share -1,930.46