Discounted Cash Flow (DCF) Analysis Levered

Altair Engineering Inc. (ALTR)

$57.29

-0.48 (-0.83%)

All numbers are in Millions, Currency in USD

Stock DCF: 10.42 | 57.29 | overvalue

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	333.33	396.38	458.92	469.92	532.18	599.15	674.55	759.44	855.01	962.61
Revenue (%)
Operating Cash Flow	16.09	36.23	31.39	32.88	61.62	47.20	53.13	59.82	67.35	75.82
Operating Cash Flow (%)
Capital Expenditure	-9.64	-9.39	-10.13	-8.23	-8.19	-12.89	-14.51	-16.34	-18.40	-20.71
Capital Expenditure (%)
Free Cash Flow	6.45	26.84	21.26	24.66	53.43	34.30	38.62	43.48	48.95	55.11

Weighted Average Cost Of Capital

Share price	$ 57.29
Beta	1.466
Diluted Shares Outstanding	73.24
Cost of Debt
Tax Rate	-2,953.47
After-tax Cost of Debt	5.26%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.550
Total Debt	229.19
Total Equity	4,195.98
Total Capital	4,425.16
Debt Weighting	5.18
Equity Weighting	94.82
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	333.33	396.38	458.92	469.92	532.18	599.15	674.55	759.44	855.01	962.61
Operating Cash Flow	16.09	36.23	31.39	32.88	61.62	47.20	53.13	59.82	67.35	75.82
Capital Expenditure	-9.64	-9.39	-10.13	-8.23	-8.19	-12.89	-14.51	-16.34	-18.40	-20.71
Free Cash Flow	6.45	26.84	21.26	24.66	53.43	34.30	38.62	43.48	48.95	55.11
WACC
PV LFCF						31.11	31.76	32.42	33.10	33.79
SUM PV LFCF										162.16

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	10.28
Free cash flow (t + 1)	56.21
Terminal Value	678.91
Present Value of Terminal Value	416.23

Intrinsic Value

Enterprise Value	578.39
Net Debt	-184.56
Equity Value	762.95
Shares Outstanding	73.24
Equity Value Per Share	10.42