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Discounted Cash Flow (DCF) Analysis Unlevered


MGIC Investment Corporation

MGIC Investment Corporation (MTG)

Financial Services

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 1,039.43942.661,041.361,062.601,066.221,124.011,144.131,164.611,185.451,206.671,228.27
Revenue (%)
EBITDA 102.70373.20609.20632.78905.96955.41643.57655.09666.82678.75690.90
EBITDA (%)
EBIT 33.47324.37556.61571.47841.57897.18578.93589.29599.84610.58621.51
EBIT (%)
Depreciation 69.2348.8352.5961.3164.4058.2264.6465.8066.9868.1869.40
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 --181.09155.4699.80155.00157.77160.60163.47166.40169.38
Total Cash (%)
Account Receivables 111.32202.9651.7657.3857.9058.00101.48103.30105.15107.03108.95
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable -----------
Accounts Payable (%)
Capital Expenditure -0.83-4.71-4.58-10.52-16.10-14.27-9.15-9.32-9.48-9.65-9.83
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 12.49
Diluted Shares Outstanding 386.08
Cost of Debt
Tax Rate 20.62
After-tax Cost of Debt -0.98
Risk-Free Rate
Market Risk Premium
Cost of Equity 16.80
Total Debt 831.59
Total Equity 4,822.11
Total Capital 5,653.70
Debt Weighting 14.71
Equity Weighting 85.29
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 1,039.43942.661,041.361,062.601,066.221,124.011,144.131,164.611,185.451,206.671,228.27
EBITDA 102.70373.20609.20632.78905.96955.41643.57655.09666.82678.75690.90
EBIT 33.47324.37556.61571.47841.57897.18578.93589.29599.84610.58621.51
Tax Rate -8.01%1.09%-140.32%33.45%54.65%20.62%-6.42%-6.42%-6.42%-6.42%-6.42%
EBIAT 36.15320.841,337.63380.28381.64712.19616.09627.12638.34649.77661.40
Depreciation 69.2348.8352.5961.3164.4058.2264.6465.8066.9868.1869.40
Accounts Receivable --91.63151.20-5.63-0.51-0.10-43.49-1.82-1.85-1.88-1.92
Inventories -----------
Accounts Payable -----------
Capital Expenditure -3.88-0.135.945.58-1.83-5.120.160.170.170.17
UFCF 105.38281.921,541.28441.91451.11768.49632.12691.26703.64716.23729.05
WACC
PV UFCF 550.10523.51463.74410.79363.89
SUM PV UFCF 3,137.69

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 14.91
Free cash flow (t + 1) 758.21
Terminal Value 6,949.72
Present Value of Terminal Value 3,468.79

Intrinsic Value

Enterprise Value 6,606.49
Net Debt 676.58
Equity Value 5,929.90
Shares Outstanding 386.08
Equity Value Per Share 15.36