Discounted Cash Flow (DCF) Analysis Levered

AAR Corp. (AIR)

$50.64

+0.73 (+1.46%)
All numbers are in Millions, Currency in USD
Stock DCF: 10.95 | 50.64 | overvalue

Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 1,748.302,051.802,0721,652.301,8201,857.481,895.741,934.781,974.632,015.29
Revenue (%)
Operating Cash Flow 64.3067.40-36.10105.2075.2058.4059.6060.8362.0863.36
Operating Cash Flow (%)
Capital Expenditure -22-17.40-23.60-11.30-17.30-18.13-18.50-18.88-19.27-19.67
Capital Expenditure (%)
Free Cash Flow 42.3050-59.7093.9057.9040.2741.1041.9442.8143.69

Weighted Average Cost Of Capital

Share price $ 50.64
Beta 1.559
Diluted Shares Outstanding 36
Cost of Debt
Tax Rate 25.12
After-tax Cost of Debt 1.15%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.888
Total Debt 156.30
Total Equity 1,823.04
Total Capital 1,979.34
Debt Weighting 7.90
Equity Weighting 92.10
Wacc

Build Up Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 1,748.302,051.802,0721,652.301,8201,857.481,895.741,934.781,974.632,015.29
Operating Cash Flow 64.3067.40-36.10105.2075.2058.4059.6060.8362.0863.36
Capital Expenditure -22-17.40-23.60-11.30-17.30-18.13-18.50-18.88-19.27-19.67
Free Cash Flow 42.3050-59.7093.9057.9040.2741.1041.9442.8143.69
WACC
PV LFCF 36.5733.8931.4129.1126.98
SUM PV LFCF 157.96

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 10.12
Free cash flow (t + 1) 44.56
Terminal Value 548.80
Present Value of Terminal Value 338.91

Intrinsic Value

Enterprise Value 496.87
Net Debt 102.80
Equity Value 394.07
Shares Outstanding 36
Equity Value Per Share 10.95