Discounted Cash Flow (DCF) Analysis Unlevered
Zynga Inc. (ZNGA)
Technology
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 | 873.27 | 690.40 | 764.69 | 741.37 | 861.32 | 907.14 | 922.20 | 937.51 | 953.07 | 968.90 | 984.98 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (%) | |||||||||||
| EBITDA | 80.95 | -151.82 | -86.03 | -72.14 | 55.38 | 51.53 | -33.20 | -33.75 | -34.31 | -34.88 | -35.46 |
| EBITDA (%) | |||||||||||
| EBIT | -65.67 | -244.75 | -146.06 | -114.24 | 25.75 | 6.71 | -113.34 | -115.22 | -117.13 | -119.08 | -121.05 |
| EBIT (%) | |||||||||||
| Depreciation | 146.62 | 92.93 | 60.03 | 42.11 | 29.63 | 44.81 | 80.14 | 81.47 | 82.82 | 84.20 | 85.59 |
| 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 | 1,125.47 | 916.51 | 987.22 | 852.50 | 681.39 | 581.21 | 997.36 | 1,013.92 | 1,030.75 | 1,047.86 | 1,065.25 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Total Cash (%) | |||||||||||
| Account Receivables | 65.67 | 89.61 | 79.60 | 77.25 | 103.70 | 91.62 | 97.57 | 99.19 | 100.84 | 102.51 | 104.21 |
| Account Receivables (%) | |||||||||||
| Inventories | - | - | - | - | - | - | - | - | - | - | - |
| Inventories (%) | |||||||||||
| Accounts Payable | 20.96 | 14.98 | 29.67 | 24.02 | 18.95 | 26.85 | 25.91 | 26.34 | 26.78 | 27.23 | 27.68 |
| Accounts Payable (%) | |||||||||||
| Capital Expenditure | 7.77 | 9.18 | 7.80 | 10.31 | 9.99 | 11.43 | 10.88 | 11.06 | 11.25 | 11.43 | 11.62 |
| Capital Expenditure (%) |
Weighted Average Cost Of Capital
| Share price | $ 6.63 |
|---|---|
| Diluted Shares Outstanding | 862.46 |
| Cost of Debt | |
| Tax Rate | 41.59 |
| After-tax Cost of Debt | -2.03 |
| Risk-Free Rate | |
| Market Risk Premium | |
| Cost of Equity | 4.78 |
| Total Debt | - |
| Total Equity | 5,718.11 |
| Total Capital | 5,718.11 |
| Debt Weighting | 0.00 |
| Equity Weighting | 100.00 |
| 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 | 873.27 | 690.40 | 764.69 | 741.37 | 861.32 | 907.14 | 922.20 | 937.51 | 953.07 | 968.90 | 984.98 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EBITDA | 80.95 | -151.82 | -86.03 | -72.14 | 55.38 | 51.53 | -33.20 | -33.75 | -34.31 | -34.88 | -35.46 |
| EBIT | -65.67 | -244.75 | -146.06 | -114.24 | 25.75 | 6.71 | -113.34 | -115.22 | -117.13 | -119.08 | -121.05 |
| Tax Rate | 42.99% | 3.14% | 6.66% | -3.29% | 29.12% | 41.59% | 20.04% | 20.04% | 20.04% | 20.04% | 20.04% |
| EBIAT | -37.44 | -237.06 | -136.33 | -118.00 | 18.25 | 3.92 | -90.63 | -92.13 | -93.66 | -95.22 | -96.80 |
| Depreciation | 146.62 | 92.93 | 60.03 | 42.11 | 29.63 | 44.81 | 80.14 | 81.47 | 82.82 | 84.20 | 85.59 |
| Accounts Receivable | - | -23.94 | 10.01 | 2.35 | -26.45 | 12.08 | -5.95 | -1.62 | -1.65 | -1.67 | -1.70 |
| Inventories | - | - | - | - | - | - | - | - | - | - | - |
| Accounts Payable | - | -5.98 | 14.69 | -5.65 | -5.07 | 7.90 | -0.94 | 0.43 | 0.44 | 0.44 | 0.45 |
| Capital Expenditure | - | -1.41 | 1.38 | -2.51 | 0.31 | -1.44 | 0.55 | -0.18 | -0.18 | -0.19 | -0.19 |
| UFCF | 109.18 | -175.46 | -50.22 | -81.69 | 16.67 | 67.28 | -16.83 | -12.04 | -12.23 | -12.44 | -12.64 |
| WACC | |||||||||||
| PV UFCF | -16.83 | -11.49 | -11.14 | -10.81 | -10.49 | ||||||
| SUM PV UFCF | -146.82 |
Terminal Value
| Growth in perpetuity method: | |
|---|---|
| Long-term growth rate | |
| WACC (%) | 4.78 |
| Free cash flow (t + 1) | -13.15 |
| Terminal Value | -1,685.92 |
| Present Value of Terminal Value | -1,334.89 |
Intrinsic Value
| Enterprise Value | -1,481.71 |
|---|---|
| Net Debt | -581.21 |
| Equity Value | -900.50 |
| Shares Outstanding | 862.46 |
| Equity Value Per Share | -1.04 |