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Discounted Cash Flow (DCF) Analysis Unlevered


Groupon Inc.

Groupon Inc. (GRPN)

Technology

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 2,573.663,042.062,954.753,013.552,843.892,636.852,660.062,683.472,707.082,730.902,754.94
Revenue (%)
EBITDA 64.0857.80127.05-63.89159.54103.8972.3572.9973.6374.2874.93
EBITDA (%)
EBIT -25.48-57.19-2.36-199.8021.61-11.87-44.16-44.55-44.94-45.33-45.73
EBIT (%)
Depreciation 89.56114.99129.42135.91137.93115.76116.51117.54118.57119.61120.67
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 1,240.501,016.66853.33863.08880.18840.89818.23825.43832.70840.03847.42
Total Cash (%)
Account Receivables 83.6490.6568.2571.4298.4069.6173.1573.8074.4475.1075.76
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable 780.59786.07800.74799.50802.26690.06712.10718.36724.69731.06737.50
Accounts Payable (%)
Capital Expenditure -65.11-83.66-81.85-68.41-59.15-69.61-66.50-67.09-67.68-68.27-68.87
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 2.56
Diluted Shares Outstanding 566.51
Cost of Debt
Tax Rate 7.95
After-tax Cost of Debt -0.35
Risk-Free Rate
Market Risk Premium
Cost of Equity 14.03
Total Debt 201.67
Total Equity 1,450.27
Total Capital 1,651.94
Debt Weighting 12.21
Equity Weighting 87.79
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 2,573.663,042.062,954.753,013.552,843.892,636.852,660.062,683.472,707.082,730.902,754.94
EBITDA 64.0857.80127.05-63.89159.54103.8972.3572.9973.6374.2874.93
EBIT -25.48-57.19-2.36-199.8021.61-11.87-44.16-44.55-44.94-45.33-45.73
Tax Rate -276.21%-27.41%982.49%2.66%34.95%7.95%120.74%120.74%120.74%120.74%120.74%
EBIAT -95.86-72.8720.86-194.4814.06-10.929.169.249.329.409.48
Depreciation 89.56114.99129.42135.91137.93115.76116.51117.54118.57119.61120.67
Accounts Receivable --7.0122.40-3.17-26.9828.79-3.54-0.64-0.65-0.66-0.66
Inventories -----------
Accounts Payable -5.4814.67-1.242.77-112.2022.036.276.326.386.43
Capital Expenditure -18.54-1.81-13.44-9.2510.46-3.110.590.590.600.60
UFCF -6.2959.14185.54-76.42118.5231.88141.05132.98134.15135.33136.52
WACC
PV UFCF 124.96104.3793.2783.3674.49
SUM PV UFCF 435.09

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 12.88
Free cash flow (t + 1) 141.98
Terminal Value 1,598.93
Present Value of Terminal Value 872.46

Intrinsic Value

Enterprise Value 1,307.54
Net Debt -639.22
Equity Value 1,946.77
Shares Outstanding 566.51
Equity Value Per Share 3.44

Results Unlevered DCF

Wacc / Long-term Growth -4 (%)-3 (%)-2 (%)-1 (%)0 (%)1 (%)2 (%)3 (%)4 (%)
14.88 (%) 2.82 Buy 2.90 Buy 2.99 Buy 3.09 Buy 3.22 Buy 3.37 Buy 3.55 Buy 3.78 Buy 4.07 Buy
14.38 (%) 2.77 Buy 2.84 Buy 2.93 Buy 3.02 Buy 3.13 Buy 3.26 Buy 3.43 Buy 3.62 Buy 3.88 Buy
13.88 (%) 2.73 Buy 2.79 Buy 2.87 Buy 2.95 Buy 3.05 Buy 3.17 Buy 3.32 Buy 3.49 Buy 3.71 Buy
13.38 (%) 2.68 Buy 2.74 Buy 2.81 Buy 2.89 Buy 2.98 Buy 3.09 Buy 3.22 Buy 3.37 Buy 3.56 Buy
12.88 (%) 2.64 Buy 2.70 Buy 2.76 Buy 2.83 Buy 2.92 Buy 3.01 Buy 3.13 Buy 3.27 Buy 3.44 Buy
12.38 (%) 2.61 Buy 2.66 Buy 2.72 Buy 2.78 Buy 2.86 Buy 2.95 Buy 3.05 Buy 3.17 Buy 3.32 Buy
11.88 (%) 2.57 Buy 2.62 Buy 2.67 Buy 2.73 Buy 2.80 Buy 2.88 Buy 2.98 Buy 3.09 Buy 3.22 Buy
11.38 (%) 2.54 Sell 2.58 Buy 2.63 Buy 2.69 Buy 2.75 Buy 2.83 Buy 2.91 Buy 3.01 Buy 3.13 Buy
10.88 (%) 2.51 Sell 2.55 Sell 2.60 Buy 2.65 Buy 2.71 Buy 2.77 Buy 2.85 Buy 2.94 Buy 3.05 Buy