Discounted Cash Flow (DCF) Analysis Levered

Arch Capital Group Ltd. (ACGL)

$59.84

-0.07 (-0.12%)
All numbers are in Millions, Currency in USD
Stock DCF: 220.07 | 59.84 | undervalue

Free Cash Flow

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 5,369.315,474.336,783.928,308.558,926.1510,171.0311,589.5213,205.8515,047.6017,146.20
Revenue (%)
Operating Cash Flow 1,112.621,559.322,048.462,886.513,427.553,103.023,535.784,028.904,590.795,231.04
Operating Cash Flow (%)
Capital Expenditure -22.84-29.81-37.84-39.87-41.39-50.27-57.28-65.27-74.37-84.75
Capital Expenditure (%)
Free Cash Flow 1,089.781,529.512,010.622,846.633,386.163,052.753,478.503,963.634,516.425,146.29

Weighted Average Cost Of Capital

Share price $ 59.84
Beta 0.782
Diluted Shares Outstanding 400.35
Cost of Debt
Tax Rate -2.54
After-tax Cost of Debt 5.12%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.283
Total Debt 2,724.39
Total Equity 23,956.70
Total Capital 26,681.09
Debt Weighting 10.21
Equity Weighting 89.79
Wacc

Build Up Free Cash Flow

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 5,369.315,474.336,783.928,308.558,926.1510,171.0311,589.5213,205.8515,047.6017,146.20
Operating Cash Flow 1,112.621,559.322,048.462,886.513,427.553,103.023,535.784,028.904,590.795,231.04
Capital Expenditure -22.84-29.81-37.84-39.87-41.39-50.27-57.28-65.27-74.37-84.75
Free Cash Flow 1,089.781,529.512,010.622,846.633,386.163,052.753,478.503,963.634,516.425,146.29
WACC
PV LFCF 2,851.443,034.853,230.073,437.833,658.97
SUM PV LFCF 16,213.16

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.06
Free cash flow (t + 1) 5,249.22
Terminal Value 103,739.54
Present Value of Terminal Value 73,757.83

Intrinsic Value

Enterprise Value 89,970.99
Net Debt 1,865.73
Equity Value 88,105.26
Shares Outstanding 400.35
Equity Value Per Share 220.07