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Discounted Cash Flow (DCF) Analysis Unlevered


Wells Fargo & Company

Wells Fargo & Company (WFC)

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 81,471.0082,953.7783,617.4084,495.3985,855.7684,662.3785,322.7385,988.2586,658.9687,334.9088,016.11
Revenue (%)
EBITDA 35,578.3935,877.5136,549.1736,983.6332,504.9933,644.8235,835.5536,115.0636,396.7636,680.6636,966.77
EBITDA (%)
EBIT 32,286.9633,364.0133,263.0032,015.3027,096.0828,048.6431,595.0131,841.4532,089.8132,340.1132,592.37
EBIT (%)
Depreciation 3,291.432,513.503,286.164,968.335,408.915,596.184,240.544,273.624,306.954,340.544,374.40
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 --509,648.07487,436.98408,527.47173,286.93398,218.26401,324.36404,454.69407,609.43410,788.79
Total Cash (%)
Account Receivables -----------
Account Receivables (%)
Inventories -----------
Inventories (%)
Accounts Payable -----------
Accounts Payable (%)
Capital Expenditure -----------
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 45.03
Diluted Shares Outstanding 4,838.40
Cost of Debt
Tax Rate 20.18
After-tax Cost of Debt -0.96
Risk-Free Rate
Market Risk Premium
Cost of Equity 11.18
Total Debt 221,198.00
Total Equity 217,873.15
Total Capital 439,071.15
Debt Weighting 50.38
Equity Weighting 49.62
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 81,471.0082,953.7783,617.4084,495.3985,855.7684,662.3785,322.7385,988.2586,658.9687,334.9088,016.11
EBITDA 35,578.3935,877.5136,549.1736,983.6332,504.9933,644.8235,835.5536,115.0636,396.7636,680.6636,966.77
EBIT 32,286.9633,364.0133,263.0032,015.3027,096.0828,048.6431,595.0131,841.4532,089.8132,340.1132,592.37
Tax Rate 32.23%30.89%31.16%31.47%18.14%20.18%27.35%27.35%27.35%27.35%27.35%
EBIAT 21,880.6823,057.0022,896.7621,939.5822,179.7922,387.9222,954.5723,133.6123,314.0523,495.9023,679.17
Depreciation 3,291.432,513.503,286.164,968.335,408.915,596.184,240.544,273.624,306.954,340.544,374.40
Accounts Receivable -----------
Inventories -----------
Accounts Payable -----------
Capital Expenditure -----------
UFCF 25,172.1125,570.5026,182.9226,907.9127,588.7027,984.1127,195.1127,407.2327,621.0027,836.4528,053.57
WACC
PV UFCF 25,283.6623,689.9222,196.6320,797.4819,486.52
SUM PV UFCF 195,862.15

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.56
Free cash flow (t + 1) 29,175.71
Terminal Value 819,542.55
Present Value of Terminal Value 569,269.00

Intrinsic Value

Enterprise Value 765,131.16
Net Debt 47,911.07
Equity Value 717,220.09
Shares Outstanding 4,838.40
Equity Value Per Share 148.23

Results Unlevered DCF

Wacc / Long-term Growth -4 (%)-3 (%)-2 (%)-1 (%)0 (%)1 (%)2 (%)3 (%)4 (%)
9.56 (%) 75.00 Buy 80.71 Buy 87.92 Buy 97.34 Buy 110.14 Buy 128.56 Buy 157.33 Buy 208.56 Buy 325.49 Buy
9.06 (%) 71.81 Buy 76.83 Buy 83.11 Buy 91.16 Buy 101.87 Buy 116.82 Buy 139.12 Buy 176.01 Buy 248.70 Buy
8.56 (%) 68.94 Buy 73.40 Buy 78.89 Buy 85.84 Buy 94.91 Buy 107.24 Buy 124.97 Buy 152.67 Buy 202.02 Buy
8.06 (%) 66.36 Buy 70.33 Buy 75.17 Buy 81.21 Buy 88.97 Buy 99.29 Buy 113.68 Buy 135.16 Buy 170.69 Buy
7.56 (%) 64.02 Buy 67.57 Buy 71.86 Buy 77.16 Buy 83.85 Buy 92.59 Buy 104.46 Buy 121.55 Buy 148.23 Buy
7.06 (%) 61.90 Buy 65.09 Buy 68.91 Buy 73.58 Buy 79.40 Buy 86.87 Buy 96.81 Buy 110.68 Buy 131.38 Buy
6.56 (%) 59.97 Buy 62.84 Buy 66.26 Buy 70.40 Buy 75.50 Buy 81.95 Buy 90.37 Buy 101.81 Buy 118.28 Buy
6.06 (%) 58.20 Buy 60.80 Buy 63.88 Buy 67.56 Buy 72.06 Buy 77.67 Buy 84.87 Buy 94.45 Buy 107.82 Buy
5.56 (%) 56.58 Buy 58.95 Buy 61.72 Buy 65.01 Buy 69.00 Buy 73.92 Buy 80.14 Buy 88.25 Buy 99.28 Buy