Discounted Cash Flow (DCF) Analysis Unlevered


Microsoft Corporation

Microsoft Corporation (MSFT)

$208.9
0.2 (+0.10%)

Operating Data

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Projected
2022
Projected
2023
Projected
Revenue 77,849.0086,832.7793,579.6891,155.9796,570.63110,360.92125,844.55143,022.34156,223.30170,642.71186,393.03
Revenue (%)
EBITDA 31,233.0233,630.3325,247.8031,357.6538,435.1149,463.7658,052.0968,421.8962,254.9868,001.1274,277.62
EBITDA (%)
EBIT 27,480.7028,420.3719,286.7724,739.7329,656.8439,200.2046,373.7255,621.3950,335.1554,981.0860,055.83
EBIT (%)
Depreciation 3,752.325,209.975,961.036,617.928,778.2710,263.5711,678.3712,800.5011,919.8413,020.0414,221.79
Depreciation (%)

Balance Sheet Data

Year
A/P
2013
Projected
2014
Projected
2015
Projected
2016
Projected
2017
Projected
2018
Projected
2019
Projected
2020
Projected
2021
Projected
2022
Projected
2023
Projected
Total Cash 76,774.6885,460.8296,284.13113,170.13132,881.19133,647.07133,823.10136,529.12172,736.10188,679.64206,094.77
Total Cash (%)
Account Receivables 17,484.8919,546.0617,911.1518,276.7722,433.3626,475.5829,523.1332,008.4034,603.4637,797.3641,286.06
Account Receivables (%)
Inventories 1,938.442,657.082,900.972,251.552,182.502,659.702,063.851,887.893,655.633,993.044,361.60
Inventories (%)
Accounts Payable 4,826.647,432.896,588.016,900.517,387.658,619.199,388.0012,528.7611,919.8413,020.0414,221.79
Accounts Payable (%)
Capital Expenditure -4,258.34-5,487.83-5,942.31-8,340.77-8,131.25-11,632.04-13,930.99-15,446.41-13,294.60-14,521.69-15,862.05
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 208.9
Diluted Shares Outstanding 7,683.00
Cost of Debt
Tax Rate 16.51
After-tax Cost of Debt 4.17%
Risk-Free Rate
Market Risk Premium
Cost of Equity 12.259
Total Debt 72,823.00
Total Equity 1,604,978.70
Total Capital 1,673,512.70
Debt Weighting 4.10
Equity Weighting 95.90
Wacc

Build Up Free Cash

Year
A/P
2013
Actual
2014
Actual
2015
Actual
2016
Actual
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Projected
2022
Projected
2023
Projected
Revenue 77,849.0086,832.7793,579.6891,155.9796,570.63110,360.92125,844.55143,022.34156,223.30170,642.71186,393.03
EBITDA 31,233.0233,630.3325,247.8031,357.6538,435.1149,463.7658,052.0968,421.8962,254.9868,001.1274,277.62
EBIT 27,480.7028,420.3719,286.7724,739.7329,656.8439,200.2046,373.7255,621.3950,335.1554,981.0860,055.83
Tax Rate 19.18%20.65%34.12%19.89%14.76%54.57%10.18%16.51%23.73%23.73%23.73%
EBIAT 22,209.4722,550.3712,706.7419,818.6125,280.8717,809.5841,652.2846,439.6038,389.6041,932.9645,803.38
Depreciation 3,752.325,209.975,961.036,617.928,778.2710,263.5711,678.3712,800.5011,919.8413,020.0414,221.79
Accounts Receivable --2,061.171,634.91-365.62-4,156.59-4,042.23-3,047.55-2,485.27-2,595.06-3,193.90-3,488.70
Inventories --718.64-243.89649.4269.06-477.20595.85175.96-1,767.73-337.41-368.56
Accounts Payable -2,606.25-844.88312.50487.151,231.53768.823,140.75-608.921,100.201,201.75
Capital Expenditure -1,229.49454.482,398.46-209.523,500.792,298.951,515.42-2,151.811,227.091,340.35
UFCF 25,961.7928,816.2619,668.3929,431.2930,249.2328,286.0453,946.7261,586.9643,185.9253,748.9858,710.01
WACC
PV UFCF 38,582.9742,901.9741,867.08
SUM PV UFCF 210,152.82

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 11.93
Free cash flow (t + 1) 61,058.41
Terminal Value 769,967.37
Present Value of Terminal Value 438,268.04

Intrinsic Value

Enterprise Value 648,420.86
Net Debt 59,247.00
Equity Value 589,173.86
Shares Outstanding 7,683.00
Equity Value Per Share 76.69