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Discounted Cash Flow (DCF) Analysis Unlevered


Alphabet Inc.

Alphabet Inc. (GOOGL)

Technology

Operating Data

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Actual
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 55,519.0066,000.9974,990.3290,273.35110,855.67136,818.07161,855.78193,530.95231,404.96276,690.91330,839.32
Revenue (%)
EBITDA 19,409.4422,757.1424,424.3529,862.4233,057.1635,353.7946,015.6060,594.5472,452.8986,631.92103,585.79
EBITDA (%)
EBIT 15,473.1517,780.6719,362.5023,714.8126,139.7726,323.8034,232.5047,240.9156,485.9567,540.2580,757.88
EBIT (%)
Depreciation 3,936.304,976.475,061.856,147.626,917.399,029.9911,783.1013,353.6415,966.9419,091.6722,827.91
Depreciation (%)

Balance Sheet Data

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Actual
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Total Cash 58,716.8964,397.1673,063.0786,337.43101,876.36109,139.78119,676.16177,487.24212,221.49253,753.24303,412.74
Total Cash (%)
Account Receivables 8,982.9710,256.5511,556.0114,136.8118,335.5320,837.3925,330.4330,461.7736,423.1443,551.1552,074.11
Account Receivables (%)
Inventories ---270.82753.821,108.231,003.511,161.191,388.431,660.151,985.04
Inventories (%)
Accounts Payable 3,825.264,494.671,927.252,040.183,137.224,378.185,567.847,741.249,256.2011,067.6413,233.57
Accounts Payable (%)
Capital Expenditure -8,805.31-10,956.169,913.7210,209.9213,180.7425,133.4823,550.0210,199.0812,195.0414,581.6117,435.23
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 1,483.46
Diluted Shares Outstanding 352.21
Cost of Debt
Tax Rate 13.33
After-tax Cost of Debt -0.62
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.60
Total Debt 4,554.00
Total Equity 522,495.38
Total Capital 527,049.38
Debt Weighting 0.86
Equity Weighting 99.14
Wacc

Build Up Free Cash

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Actual
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 55,519.0066,000.9974,990.3290,273.35110,855.67136,818.07161,855.78193,530.95231,404.96276,690.91330,839.32
EBITDA 19,409.4422,757.1424,424.3529,862.4233,057.1635,353.7946,015.6060,594.5472,452.8986,631.92103,585.79
EBIT 15,473.1517,780.6719,362.5023,714.8126,139.7726,323.8034,232.5047,240.9156,485.9567,540.2580,757.88
Tax Rate 17.70%20.47%16.81%19.35%53.44%11.96%13.33%21.87%21.87%21.87%21.87%
EBIAT 12,733.9414,140.5116,107.9919,127.0012,171.5823,174.4129,669.3236,911.3444,134.8852,772.0863,099.58
Depreciation 3,936.304,976.475,061.856,147.626,917.399,029.9911,783.1013,353.6415,966.9419,091.6722,827.91
Accounts Receivable --1,273.58-1,299.46-2,580.80-4,198.72-2,501.86-4,493.04-5,131.34-5,961.37-7,128.01-8,522.96
Inventories -----483.00-354.41104.72-157.68-227.24-271.72-324.89
Accounts Payable -669.41-2,567.42112.931,097.041,240.961,189.662,173.401,514.961,811.442,165.94
Capital Expenditure -2,150.85-20,869.88-296.20-2,970.82-11,952.741,583.4613,350.93-1,995.96-2,386.57-2,853.62
UFCF 16,670.2420,663.66-3,566.9222,510.5512,533.4718,636.3539,837.2260,500.2853,432.2163,888.9076,391.96
WACC
PV UFCF 49,503.9639,548.2242,775.0446,265.14
SUM PV UFCF 179,524.84

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 10.55
Free cash flow (t + 1) 79,447.63
Terminal Value 1,212,940.98
Present Value of Terminal Value 734,591.56

Intrinsic Value

Enterprise Value 914,116.40
Net Debt -115,122.16
Equity Value 1,029,238.56
Shares Outstanding 352.21
Equity Value Per Share 2,922.20