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Discounted Cash Flow (DCF) Analysis Unlevered


Western Digital Corporation

Western Digital Corporation (WDC)

Technology

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 15,351.0015,129.9514,571.6512,993.5419,092.7120,646.8616,569.1017,104.2817,656.7518,227.0618,815.80
Revenue (%)
EBITDA 2,509.893,051.712,739.471,573.523,744.084,816.911,993.262,991.543,088.173,187.913,290.88
EBITDA (%)
EBIT 1,277.201,808.031,626.20419.691,615.242,760.48180.601,407.681,453.151,500.091,548.54
EBIT (%)
Depreciation 1,232.691,243.681,113.271,153.832,128.842,056.431,812.661,583.861,635.021,687.831,742.34
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 4,309.035,088.205,286.598,378.246,354.055,004.803,454.665,883.876,073.926,270.116,472.63
Total Cash (%)
Account Receivables 1,793.001,989.591,531.481,460.471,947.462,196.831,204.571,825.031,883.981,944.832,007.65
Account Receivables (%)
Inventories 1,188.171,225.531,368.282,129.642,340.772,944.243,282.342,148.302,217.692,289.322,363.26
Inventories (%)
Accounts Payable 1,989.491,971.431,881.202,055.582,350.312,523.051,898.822,216.722,288.322,362.232,438.53
Accounts Payable (%)
Capital Expenditure -951.76-627.89-612.01-583.41-557.51-809.36-757.21-744.04-768.07-792.88-818.49
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 51.12
Diluted Shares Outstanding 292.00
Cost of Debt
Tax Rate -162.72
After-tax Cost of Debt 8.19
Risk-Free Rate
Market Risk Premium
Cost of Equity 14.35
Total Debt 10,246.00
Total Equity 14,927.04
Total Capital 25,173.04
Debt Weighting 40.70
Equity Weighting 59.30
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 15,351.0015,129.9514,571.6512,993.5419,092.7120,646.8616,569.1017,104.2817,656.7518,227.0618,815.80
EBITDA 2,509.893,051.712,739.471,573.523,744.084,816.911,993.262,991.543,088.173,187.913,290.88
EBIT 1,277.201,808.031,626.20419.691,615.242,760.48180.601,407.681,453.151,500.091,548.54
Tax Rate 19.80%7.71%7.10%-58.17%48.37%67.63%-162.72%-10.04%-10.04%-10.04%-10.04%
EBIAT 1,024.271,668.711,510.70663.83833.88893.68474.481,549.011,599.041,650.691,704.01
Depreciation 1,232.691,243.681,113.271,153.832,128.842,056.431,812.661,583.861,635.021,687.831,742.34
Accounts Receivable --196.59458.1171.01-486.98-249.37992.25-620.45-58.95-60.85-62.82
Inventories --37.36-142.75-761.36-211.12-603.48-338.101,134.04-69.39-71.63-73.95
Accounts Payable --18.06-90.23174.38294.73172.73-624.23317.9071.6073.9176.30
Capital Expenditure --323.87-15.88-28.60-25.90251.85-52.15-13.1724.0324.8125.61
UFCF 2,256.962,336.522,833.221,273.072,533.442,521.852,264.923,951.173,201.353,304.753,411.50
WACC
PV UFCF 3,047.782,168.801,966.321,782.74
SUM PV UFCF 13,970.53

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 13.86
Free cash flow (t + 1) 3,547.95
Terminal Value 35,983.32
Present Value of Terminal Value 18,803.78

Intrinsic Value

Enterprise Value 32,774.32
Net Debt 6,791.34
Equity Value 25,982.98
Shares Outstanding 292.00
Equity Value Per Share 88.98