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Discounted Cash Flow (DCF) Analysis Unlevered


Netflix Inc.

Netflix Inc. (NFLX)

Communication 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 4,374.565,504.516,779.368,830.7911,692.8515,794.7020,430.4426,426.7834,183.0444,215.7657,193.09
Revenue (%)
EBITDA 2,441.883,181.613,821.525,335.567,054.309,303.0811,904.8215,398.8819,918.4625,764.5233,326.41
EBITDA (%)
EBIT 200.35399.63274.56410.63723.791,647.391,264.641,635.822,115.932,736.963,540.25
EBIT (%)
Depreciation 2,241.532,781.983,546.964,924.936,330.517,655.6910,640.1813,763.0717,802.5323,027.5729,786.16
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 1,200.381,608.422,310.401,733.482,822.653,793.895,397.726,981.959,031.1611,681.8015,110.41
Total Cash (%)
Account Receivables -----------
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable 1,884.562,319.053,042.583,945.604,532.155,248.588,403.0410,869.3314,059.4818,185.9423,523.52
Accounts Payable (%)
Capital Expenditure -119.86-144.77-169.48-184.56-226.84-213.23-451.51-584.03-755.45-977.17-1,263.97
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 310.32
Diluted Shares Outstanding 435.37
Cost of Debt
Tax Rate 1.24
After-tax Cost of Debt -0.01
Risk-Free Rate
Market Risk Premium
Cost of Equity 13.14
Total Debt 10,360.06
Total Equity 135,105.26
Total Capital 145,465.32
Debt Weighting 7.12
Equity Weighting 92.88
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 4,374.565,504.516,779.368,830.7911,692.8515,794.7020,430.4426,426.7834,183.0444,215.7657,193.09
EBITDA 2,441.883,181.613,821.525,335.567,054.309,303.0811,904.8215,398.8819,918.4625,764.5233,326.41
EBIT 200.35399.63274.56410.63723.791,647.391,264.641,635.822,115.932,736.963,540.25
Tax Rate 34.30%23.63%13.56%28.34%-15.17%1.24%14.32%14.32%14.32%14.32%14.32%
EBIAT 131.64305.18237.32294.26833.561,626.951,083.571,401.601,812.972,345.083,033.36
Depreciation 2,241.532,781.983,546.964,924.936,330.517,655.6910,640.1813,763.0717,802.5323,027.5729,786.16
Accounts Receivable -----------
Inventories -----------
Accounts Payable -434.49723.52903.02586.55716.433,154.462,466.293,190.154,126.465,337.57
Capital Expenditure -24.9124.7215.0842.28-13.61238.28132.52171.41221.72286.80
UFCF 2,373.173,546.554,532.526,137.297,792.909,985.4615,116.5017,763.4822,977.0629,720.8338,443.90
WACC
PV UFCF 13,429.7214,020.3816,111.7318,515.0421,276.83
SUM PV UFCF 62,116.52

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 12.56
Free cash flow (t + 1) 39,981.65
Terminal Value 467,075.37
Present Value of Terminal Value 258,503.57

Intrinsic Value

Enterprise Value 320,620.09
Net Debt 6,566.17
Equity Value 314,053.92
Shares Outstanding 435.37
Equity Value Per Share 721.34