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Discounted Cash Flow (DCF) Analysis Unlevered


Rite Aid Corporation

Rite Aid Corporation (RAD)

Consumer Defensive

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 25,392.2625,526.8426,530.0520,770.3722,928.4221,529.7821,639.5821,189.4820,748.7420,317.1719,894.57
Revenue (%)
EBITDA 936.971,079.791,241.61762.27655.751,838.64240.20870.89852.77835.04817.67
EBITDA (%)
EBIT 523.08676.46825.08400.87247.631,453.26-116.85514.90504.19493.71483.44
EBIT (%)
Depreciation 413.89403.32416.52361.40408.13385.38357.05355.98348.58341.33334.23
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 129.50145.50116.73124.62245.33447.82144.99180.11176.36172.70169.10
Total Cash (%)
Account Receivables 929.36949.60981.611,601.401,770.071,868.791,789.591,315.871,288.501,261.701,235.45
Account Receivables (%)
Inventories 3,153.722,994.302,883.822,698.071,788.421,799.891,871.822,203.712,157.872,112.992,069.04
Inventories (%)
Accounts Payable 1,383.881,291.661,132.831,543.241,614.161,651.331,618.641,343.411,315.471,288.111,261.32
Accounts Payable (%)
Capital Expenditure -314.86-334.40-427.13-390.48-254.51-185.16-196.92-271.23-265.58-260.06-254.65
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 7.57
Diluted Shares Outstanding 53.34
Cost of Debt
Tax Rate -22.47
After-tax Cost of Debt 1.17
Risk-Free Rate
Market Risk Premium
Cost of Equity 16.47
Total Debt 3,478.65
Total Equity 403.81
Total Capital 3,882.46
Debt Weighting 89.60
Equity Weighting 10.40
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 25,392.2625,526.8426,530.0520,770.3722,928.4221,529.7821,639.5821,189.4820,748.7420,317.1719,894.57
EBITDA 936.971,079.791,241.61762.27655.751,838.64240.20870.89852.77835.04817.67
EBIT 523.08676.46825.08400.87247.631,453.26-116.85514.90504.19493.71483.44
Tax Rate -1,473.68%0.32%-394.16%23.03%91.64%24.49%-22.47%-250.12%-250.12%-250.12%-250.12%
EBIAT 8,231.64674.294,077.24308.5420.701,097.36-143.121,802.781,765.281,728.561,692.61
Depreciation 413.89403.32416.52361.40408.13385.38357.05355.98348.58341.33334.23
Accounts Receivable --20.24-32.01-619.78-168.68-98.7179.19473.7327.3726.8026.24
Inventories -159.42110.48185.74909.66-11.47-71.93-331.8845.8444.8843.95
Accounts Payable --92.22-158.83410.4170.9237.17-32.69-275.23-27.94-27.36-26.79
Capital Expenditure -19.5492.73-36.65-135.98-69.3511.7674.31-5.64-5.52-5.41
UFCF 8,645.531,144.114,506.13609.661,104.741,340.39200.272,099.682,153.482,108.692,064.83
WACC
PV UFCF 1,827.111,748.061,596.741,458.51
SUM PV UFCF 19,335.44

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.20
Free cash flow (t + 1) 2,147.42
Terminal Value 67,106.96
Present Value of Terminal Value 47,401.67

Intrinsic Value

Enterprise Value 66,737.11
Net Debt 3,333.66
Equity Value 63,403.45
Shares Outstanding 53.34
Equity Value Per Share 1,188.58