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Discounted Cash Flow (DCF) Analysis Unlevered


Regions Financial Corporation

Regions Financial Corporation (RF)

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 5,221.005,113.975,136.985,146.745,350.555,524.455,588.535,653.365,718.945,785.285,852.38
Revenue (%)
EBITDA 2,264.872,165.771,976.202,183.252,354.782,544.012,384.072,411.722,439.702,468.002,496.63
EBITDA (%)
EBIT 1,620.081,642.611,453.251,609.391,817.582,082.161,825.771,846.951,868.381,890.051,911.97
EBIT (%)
Depreciation 644.79523.16522.94573.86537.20461.84558.29564.77571.32577.95584.65
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 --5,314.215,450.925,880.265,058.185,739.425,806.005,873.355,941.486,010.40
Total Cash (%)
Account Receivables -----------
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable -----------
Accounts Payable (%)
Capital Expenditure -185.87-241.89-368.84-204.84-149.82-150.82-239.75-242.53-245.34-248.19-251.07
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 13.57
Diluted Shares Outstanding 1,102.00
Cost of Debt
Tax Rate 18.59
After-tax Cost of Debt -0.88
Risk-Free Rate
Market Risk Premium
Cost of Equity 14.33
Total Debt 12,424.00
Total Equity 14,954.14
Total Capital 27,378.14
Debt Weighting 45.38
Equity Weighting 54.62
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 5,221.005,113.975,136.985,146.745,350.555,524.455,588.535,653.365,718.945,785.285,852.38
EBITDA 2,264.872,165.771,976.202,183.252,354.782,544.012,384.072,411.722,439.702,468.002,496.63
EBIT 1,620.081,642.611,453.251,609.391,817.582,082.161,825.771,846.951,868.381,890.051,911.97
Tax Rate 34.63%33.35%31.31%31.70%34.05%18.59%30.61%30.61%30.61%30.61%30.61%
EBIAT 1,059.051,094.74998.171,099.261,198.731,695.131,266.991,281.691,296.561,311.601,326.81
Depreciation 644.79523.16522.94573.86537.20461.84558.29564.77571.32577.95584.65
Accounts Receivable -----------
Inventories -----------
Accounts Payable -----------
Capital Expenditure -56.02126.94-163.99-55.021.0088.932.782.812.852.88
UFCF 1,703.841,673.921,648.061,509.131,680.902,157.981,914.221,849.241,870.691,892.391,914.34
WACC
PV UFCF 1,745.271,537.231,417.821,307.681,206.10
SUM PV UFCF 11,679.48

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 9.68
Free cash flow (t + 1) 1,990.92
Terminal Value 35,051.37
Present Value of Terminal Value 22,083.50

Intrinsic Value

Enterprise Value 33,762.97
Net Debt 7,365.82
Equity Value 26,397.16
Shares Outstanding 1,102.00
Equity Value Per Share 23.95

Results Unlevered DCF

Wacc / Long-term Growth -4 (%)-3 (%)-2 (%)-1 (%)0 (%)1 (%)2 (%)3 (%)4 (%)
11.68 (%) 13.78 Buy 14.81 Buy 16.06 Buy 17.60 Buy 19.54 Buy 22.06 Buy 25.46 Buy 30.32 Buy 37.83 Buy
11.18 (%) 13.16 Sell 14.09 Buy 15.20 Buy 16.56 Buy 18.25 Buy 20.41 Buy 23.27 Buy 27.23 Buy 33.09 Buy
10.68 (%) 12.59 Sell 13.43 Sell 14.43 Buy 15.63 Buy 17.11 Buy 18.98 Buy 21.41 Buy 24.69 Buy 29.38 Buy
10.18 (%) 12.07 Sell 12.83 Sell 13.73 Buy 14.80 Buy 16.11 Buy 17.74 Buy 19.82 Buy 22.58 Buy 26.40 Buy
9.68 (%) 11.59 Sell 12.29 Sell 13.10 Sell 14.06 Buy 15.22 Buy 16.65 Buy 18.45 Buy 20.79 Buy 23.95 Buy
9.18 (%) 11.16 Sell 11.79 Sell 12.52 Sell 13.39 Sell 14.42 Buy 15.69 Buy 17.25 Buy 19.26 Buy 21.92 Buy
8.68 (%) 10.75 Sell 11.33 Sell 12.00 Sell 12.78 Sell 13.71 Buy 14.83 Buy 16.20 Buy 17.94 Buy 20.20 Buy
8.18 (%) 10.38 Sell 10.91 Sell 11.52 Sell 12.23 Sell 13.06 Sell 14.06 Buy 15.28 Buy 16.79 Buy 18.73 Buy
7.68 (%) 10.04 Sell 10.52 Sell 11.08 Sell 11.72 Sell 12.48 Sell 13.37 Sell 14.45 Buy 15.78 Buy 17.45 Buy