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Discounted Cash Flow (DCF) Analysis Unlevered


Johnson & Johnson

Johnson & Johnson (JNJ)

Healthcare

Operating Data

Year
A/P
2013
Actual
2014
Actual
2015
Projected
2016
Projected
2017
Projected
2018
Projected
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 71,312.0074,328.5077,472.5980,749.6884,165.4087,725.5991,436.3895,304.1499,335.51103,537.40107,917.03
Revenue (%)
EBITDA 18,312.9220,053.8320,398.5321,261.3922,160.7523,098.1524,075.2025,093.5826,155.0427,261.4028,414.55
EBITDA (%)
EBIT 14,212.4816,159.0216,137.5416,820.1617,531.6518,273.2419,046.2019,851.8520,691.5921,566.8422,479.12
EBIT (%)
Depreciation 4,100.443,894.814,260.994,441.234,629.104,824.915,029.005,241.735,463.455,694.565,935.44
Depreciation (%)

Balance Sheet Data

Year
A/P
2013
Actual
2014
Actual
2015
Projected
2016
Projected
2017
Projected
2018
Projected
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Total Cash 29,209.4033,091.0533,111.7934,512.4135,972.2937,493.9239,079.9140,732.9942,456.0044,251.8846,123.74
Total Cash (%)
Account Receivables 11,716.5610,985.7512,085.7212,596.9513,129.8013,685.1914,264.0814,867.4515,496.3416,151.8316,835.06
Account Receivables (%)
Inventories 7,879.988,183.578,545.238,906.699,283.449,676.1310,085.4310,512.0510,956.7111,420.1811,903.25
Inventories (%)
Accounts Payable 6,268.327,633.547,383.147,695.448,020.968,360.258,713.899,082.489,466.679,867.1110,284.49
Accounts Payable (%)
Capital Expenditure -3,594.12-3,716.42-3,889.12-4,053.63-4,225.10-4,403.82-4,590.11-4,784.27-4,986.64-5,197.58-5,417.44
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 140.01
Diluted Shares Outstanding 2,681.50
Cost of Debt
Tax Rate 15.01
After-tax Cost of Debt -0.70
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.78
Total Debt 27,684.00
Total Equity 375,436.82
Total Capital 403,120.82
Debt Weighting 6.87
Equity Weighting 93.13
Wacc

Build Up Free Cash

Year
A/P
2013
Actual
2014
Actual
2015
Projected
2016
Projected
2017
Projected
2018
Projected
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Revenue 71,312.0074,328.5077,472.5980,749.6884,165.4087,725.5991,436.3895,304.1499,335.51103,537.40107,917.03
EBITDA 18,312.9220,053.8320,398.5321,261.3922,160.7523,098.1524,075.2025,093.5826,155.0427,261.4028,414.55
EBIT 14,212.4816,159.0216,137.5416,820.1617,531.6518,273.2419,046.2019,851.8520,691.5921,566.8422,479.12
Tax Rate 29.85%32.74%19.80%14.97%6.41%15.01%19.80%19.80%19.80%19.80%19.80%
EBIAT 9,970.1410,868.8112,943.0414,302.7416,407.7115,530.0715,275.9215,922.0916,595.5917,297.5818,029.27
Depreciation 4,100.443,894.814,260.994,441.234,629.104,824.915,029.005,241.735,463.455,694.565,935.44
Accounts Receivable -730.81-1,099.97-511.23-532.85-555.39-578.88-603.37-628.89-655.50-683.22
Inventories --303.59-361.66-361.46-376.75-392.69-409.30-426.61-444.66-463.47-483.07
Accounts Payable -1,365.21-250.40312.31325.52339.29353.64368.60384.19400.44417.38
Capital Expenditure -122.30172.70164.51171.47178.72186.28194.16202.37210.93219.86
UFCF 14,070.5816,678.3515,664.7018,348.1020,624.1919,924.9119,856.6520,696.5921,572.0522,484.5523,435.65
WACC
PV UFCF 19,481.9421,219.3122,179.2619,924.9118,464.4317,896.1117,345.2816,811.4116,293.97
SUM PV UFCF 137,165.63

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.54
Free cash flow (t + 1) 24,373.08
Terminal Value 688,504.95
Present Value of Terminal Value 478,692.81

Intrinsic Value

Enterprise Value 615,858.44
Net Debt -9,809.92
Equity Value 625,668.36
Shares Outstanding 2,681.50
Equity Value Per Share 233.33