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Discounted Cash Flow (DCF) Analysis Unlevered


Williams Companies Inc. (The)

Williams Companies Inc. (The) (WMB)

Energy

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 6,860.007,637.247,360.017,499.118,030.808,686.119,117.819,570.9710,046.6410,545.9611,070.09
Revenue (%)
EBITDA 2,256.945,427.021,885.632,530.953,051.702,868.153,673.573,856.144,047.794,248.974,460.14
EBITDA (%)
EBIT 1,441.974,250.89147.94767.911,315.441,143.091,777.061,865.381,958.092,055.412,157.56
EBIT (%)
Depreciation 814.971,176.131,737.701,763.041,736.261,725.061,896.501,990.762,089.702,193.562,302.58
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 681.20239.81100.10170.23898.65167.64362.89380.92399.86419.73440.59
Total Cash (%)
Account Receivables 600.25972.221,040.70938.14975.74991.951,147.931,204.981,264.871,327.741,393.72
Account Receivables (%)
Inventories 194.14230.64127.33137.98113.23130.29173.24181.85190.89200.37210.33
Inventories (%)
Accounts Payable 959.71865.30744.10623.18978.15661.88903.57948.48995.621,045.101,097.05
Accounts Payable (%)
Capital Expenditure -3,572.00-4,030.93-3,077.22-1,802.79-2,014.12-2,851.65-3,219.50-3,379.51-3,547.47-3,723.78-3,908.85
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 23.11
Diluted Shares Outstanding 973.63
Cost of Debt
Tax Rate -811.76
After-tax Cost of Debt 40.64
Risk-Free Rate
Market Risk Premium
Cost of Equity 16.24
Total Debt 22,367.00
Total Equity 22,500.50
Total Capital 44,867.50
Debt Weighting 49.85
Equity Weighting 50.15
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 6,860.007,637.247,360.017,499.118,030.808,686.119,117.819,570.9710,046.6410,545.9611,070.09
EBITDA 2,256.945,427.021,885.632,530.953,051.702,868.153,673.573,856.144,047.794,248.974,460.14
EBIT 1,441.974,250.89147.94767.911,315.441,143.091,777.061,865.381,958.092,055.412,157.56
Tax Rate 48.26%37.14%41.13%5.57%-987.00%-811.76%-277.78%-277.78%-277.78%-277.78%-277.78%
EBIAT 746.152,672.1387.08725.1514,298.8810,422.316,713.357,047.007,397.247,764.888,150.79
Depreciation 814.971,176.131,737.701,763.041,736.261,725.061,896.501,990.762,089.702,193.562,302.58
Accounts Receivable --371.97-68.48102.57-37.60-16.21-155.98-57.05-59.89-62.86-65.99
Inventories --36.51103.32-10.6624.75-17.06-42.95-8.61-9.04-9.49-9.96
Accounts Payable --94.41-121.20-120.92354.98-316.27241.6944.9147.1449.4851.94
Capital Expenditure -458.93-953.72-1,274.43211.34837.53367.85160.01167.96176.31185.07
UFCF 1,561.113,804.31784.701,184.7516,588.6012,635.369,020.479,177.029,633.1110,111.8810,614.44
WACC
PV UFCF 6,892.695,358.234,297.803,447.242,765.01
SUM PV UFCF 15,534.94

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 30.87
Free cash flow (t + 1) 11,039.02
Terminal Value 41,083.05
Present Value of Terminal Value 10,701.93

Intrinsic Value

Enterprise Value 26,236.87
Net Debt 22,199.36
Equity Value 4,037.51
Shares Outstanding 973.63
Equity Value Per Share 4.15

Results Unlevered DCF

Wacc / Long-term Growth -4 (%)-3 (%)-2 (%)-1 (%)0 (%)1 (%)2 (%)3 (%)4 (%)
32.87 (%) 2.11 Sell 2.49 Sell 2.89 Sell 3.32 Sell 3.78 Sell 4.27 Sell 4.80 Sell 5.37 Sell 5.98 Sell
32.37 (%) 1.81 Sell 2.17 Sell 2.55 Sell 2.96 Sell 3.40 Sell 3.87 Sell 4.37 Sell 4.91 Sell 5.49 Sell
31.87 (%) 1.52 Sell 1.86 Sell 2.23 Sell 2.62 Sell 3.03 Sell 3.48 Sell 3.96 Sell 4.47 Sell 5.02 Sell
31.37 (%) 1.24 Sell 1.57 Sell 1.92 Sell 2.29 Sell 2.69 Sell 3.11 Sell 3.56 Sell 4.05 Sell 4.57 Sell
30.87 (%) 0.97 Sell 1.29 Sell 1.62 Sell 1.98 Sell 2.35 Sell 2.76 Sell 3.19 Sell 3.65 Sell 4.15 Sell
30.37 (%) 0.72 Sell 1.02 Sell 1.34 Sell 1.68 Sell 2.04 Sell 2.42 Sell 2.83 Sell 3.27 Sell 3.74 Sell
29.87 (%) 0.47 Sell 0.76 Sell 1.07 Sell 1.39 Sell 1.73 Sell 2.10 Sell 2.49 Sell 2.91 Sell 3.36 Sell
29.37 (%) 0.24 Sell 0.51 Sell 0.80 Sell 1.11 Sell 1.44 Sell 1.79 Sell 2.16 Sell 2.56 Sell 2.99 Sell
28.87 (%) 0.01 Sell 0.27 Sell 0.55 Sell 0.85 Sell 1.16 Sell 1.50 Sell 1.85 Sell 2.23 Sell 2.64 Sell