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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 1,039.43941.831,040.821,062.571,066.181,123.971,144.091,164.571,185.421,206.631,228.23
Revenue (%)
EBITDA 22.56303.08540.29576.02848.90902.32572.73582.98593.42604.04614.85
EBITDA (%)
EBIT -46.15254.67487.73514.71784.50844.10508.32517.42526.68536.11545.70
EBIT (%)
Depreciation 68.7148.4152.5661.3164.4058.2264.4165.5766.7467.9369.15
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 5,196.664,807.494,838.664,840.655,083.145,303.915,490.615,588.895,688.935,790.765,894.42
Total Cash (%)
Account Receivables 62.2657.4548.5052.3854.0655.0760.4161.4962.5963.7164.85
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable -----------
Accounts Payable (%)
Capital Expenditure --4.5810.5216.1014.2712.0112.2312.4512.6712.90
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 13.78
Diluted Shares Outstanding 365.41
Cost of Debt
Tax Rate 20.62
After-tax Cost of Debt -0.98
Risk-Free Rate
Market Risk Premium
Cost of Equity 14.43
Total Debt 155.00
Total Equity 5,035.29
Total Capital 5,190.29
Debt Weighting 2.99
Equity Weighting 97.01
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 1,039.43941.831,040.821,062.571,066.181,123.971,144.091,164.571,185.421,206.631,228.23
EBITDA 22.56303.08540.29576.02848.90902.32572.73582.98593.42604.04614.85
EBIT -46.15254.67487.73514.71784.50844.10508.32517.42526.68536.11545.70
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 -49.85251.901,172.10342.51355.76670.06540.95550.63560.49570.52580.73
Depreciation 68.7148.4152.5661.3164.4058.2264.4165.5766.7467.9369.15
Accounts Receivable -4.818.95-3.88-1.67-1.02-5.33-1.08-1.10-1.12-1.14
Inventories -----------
Accounts Payable -----------
Capital Expenditure ----5.94-5.581.822.26-0.22-0.22-0.22-0.23
UFCF 18.86305.121,233.61394.00412.91729.09602.29614.90625.91637.11648.51
WACC
PV UFCF 602.29538.87480.69428.79382.49
SUM PV UFCF 2,822.97

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 14.11
Free cash flow (t + 1) 674.45
Terminal Value 6,671.16
Present Value of Terminal Value 3,448.13

Intrinsic Value

Enterprise Value 6,271.10
Net Debt -5,148.91
Equity Value 11,420.01
Shares Outstanding 365.41
Equity Value Per Share 31.25