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Discounted Cash Flow (DCF) Analysis Unlevered


Medtronic plc.

Medtronic plc. (MDT)

Healthcare

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 16,590.0017,004.7520,261.1628,833.6629,710.2029,953.8230,558.8934,115.9538,087.0442,520.3747,469.74
Revenue (%)
EBITDA 5,220.874,662.705,071.378,110.918,615.969,474.399,280.739,757.1610,892.8912,160.8313,576.35
EBITDA (%)
EBIT 4,401.333,812.463,764.525,290.985,698.426,829.476,622.116,993.777,807.848,716.689,731.30
EBIT (%)
Depreciation 819.55850.241,306.842,819.932,917.542,644.922,658.622,763.393,085.053,444.153,845.05
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 11,130.2314,241.4819,479.0812,634.9113,708.2911,226.699,849.1319,306.2121,553.4624,062.2826,863.13
Total Cash (%)
Account Receivables 3,727.773,810.765,111.895,562.015,591.465,987.776,221.797,171.178,005.908,937.789,978.14
Account Receivables (%)
Inventories 1,712.091,724.283,462.633,471.573,339.433,579.483,752.634,250.854,745.655,298.045,914.73
Inventories (%)
Accounts Payable 680.19741.411,610.761,709.841,553.841,629.491,952.712,006.022,239.522,500.202,791.22
Accounts Payable (%)
Capital Expenditure -456.23-396.21-571.36-1,046.66-1,253.77-1,069.35-1,133.73-1,153.12-1,287.34-1,437.19-1,604.48
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 102.81
Diluted Shares Outstanding 1,357.50
Cost of Debt
Tax Rate 10.56
After-tax Cost of Debt -0.48
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.79
Total Debt 24,486.00
Total Equity 139,564.58
Total Capital 164,050.58
Debt Weighting 14.93
Equity Weighting 85.07
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 16,590.0017,004.7520,261.1628,833.6629,710.2029,953.8230,558.8934,115.9538,087.0442,520.3747,469.74
EBITDA 5,220.874,662.705,071.378,110.918,615.969,474.399,280.739,757.1610,892.8912,160.8313,576.35
EBIT 4,401.333,812.463,764.525,290.985,698.426,829.476,622.116,993.777,807.848,716.689,731.30
Tax Rate 18.44%17.27%23.26%18.40%12.55%45.39%10.56%20.84%20.84%20.84%20.84%
EBIAT 3,589.603,153.902,888.734,317.224,983.333,729.545,922.565,536.186,180.596,900.017,703.18
Depreciation 819.55850.241,306.842,819.932,917.542,644.922,658.622,763.393,085.053,444.153,845.05
Accounts Receivable --82.99-1,301.13-450.12-29.45-396.31-234.02-949.38-834.72-931.89-1,040.36
Inventories --12.19-1,738.35-8.94132.15-240.06-173.15-498.22-494.80-552.39-616.69
Accounts Payable -61.22869.3699.07-155.9975.64323.2353.30233.50260.68291.02
Capital Expenditure --60.01175.15475.30207.11-184.4264.3819.38134.22149.85167.29
UFCF 4,409.153,910.162,200.607,252.468,054.695,629.328,561.626,924.678,303.849,270.4110,349.49
WACC
PV UFCF 5,921.426,566.296,778.816,998.21
SUM PV UFCF 44,804.34

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.14
Free cash flow (t + 1) 10,763.47
Terminal Value 259,987.13
Present Value of Terminal Value 175,800.47

Intrinsic Value

Enterprise Value 220,604.80
Net Debt 14,636.87
Equity Value 205,967.93
Shares Outstanding 1,357.50
Equity Value Per Share 151.73

Results Unlevered DCF

Wacc / Long-term Growth -4 (%)-3 (%)-2 (%)-1 (%)0 (%)1 (%)2 (%)3 (%)4 (%)
10.14 (%) 75.80 Sell 82.29 Sell 90.36 Sell 100.70 Sell 114.40 Buy 133.43 Buy 161.66 Buy 207.87 Buy 297.27 Buy
9.64 (%) 72.10 Sell 77.85 Sell 84.93 Sell 93.86 Sell 105.48 Buy 121.22 Buy 143.75 Buy 178.65 Buy 240.00 Buy
9.14 (%) 68.76 Sell 73.88 Sell 80.13 Sell 87.90 Sell 97.86 Sell 111.06 Buy 129.39 Buy 156.58 Buy 201.09 Buy
8.64 (%) 65.74 Sell 70.32 Sell 75.86 Sell 82.68 Sell 91.28 Sell 102.48 Sell 117.64 Buy 139.34 Buy 172.97 Buy
8.14 (%) 62.99 Sell 67.11 Sell 72.05 Sell 78.06 Sell 85.55 Sell 95.15 Sell 107.86 Buy 125.53 Buy 151.73 Buy
7.64 (%) 60.48 Sell 64.20 Sell 68.62 Sell 73.96 Sell 80.53 Sell 88.82 Sell 99.61 Sell 114.22 Buy 135.14 Buy
7.14 (%) 58.19 Sell 61.56 Sell 65.53 Sell 70.29 Sell 76.09 Sell 83.31 Sell 92.56 Sell 104.81 Buy 121.84 Buy
6.64 (%) 56.09 Sell 59.15 Sell 62.74 Sell 67.00 Sell 72.14 Sell 78.48 Sell 86.47 Sell 96.87 Sell 110.96 Buy
6.14 (%) 54.16 Sell 56.95 Sell 60.19 Sell 64.03 Sell 68.61 Sell 74.20 Sell 81.17 Sell 90.08 Sell 101.90 Sell