Discounted Cash Flow (DCF) Analysis Levered

Broadcom Inc. (AVGO)

$604.39

-10.06 (-1.64%)
All numbers are in Millions, Currency in USD
Stock DCF: 835.58 | 604.39 | undervalue

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 20,84822,59723,88827,45033,20337,351.0342,017.2847,266.4853,171.4659,814.14
Revenue (%)
Operating Cash Flow 8,8809,69712,06113,76416,73617,670.3119,877.8522,361.1825,154.7528,297.32
Operating Cash Flow (%)
Capital Expenditure -635-432-463-443-424-731.08-822.42-925.16-1,040.74-1,170.76
Capital Expenditure (%)
Free Cash Flow 8,2459,26511,59813,32116,31216,939.2219,055.4321,436.0224,114.0127,126.56

Weighted Average Cost Of Capital

Share price $ 604.39
Beta 1.121
Diluted Shares Outstanding 423
Cost of Debt
Tax Rate 7.55
After-tax Cost of Debt 4.07%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.929
Total Debt 39,515
Total Equity 255,656.97
Total Capital 295,171.97
Debt Weighting 13.39
Equity Weighting 86.61
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 20,84822,59723,88827,45033,20337,351.0342,017.2847,266.4853,171.4659,814.14
Operating Cash Flow 8,8809,69712,06113,76416,73617,670.3119,877.8522,361.1825,154.7528,297.32
Capital Expenditure -635-432-463-443-424-731.08-822.42-925.16-1,040.74-1,170.76
Free Cash Flow 8,2459,26511,59813,32116,31216,939.2219,055.4321,436.0224,114.0127,126.56
WACC
PV LFCF 15,643.9116,252.5816,884.9317,541.8918,224.41
SUM PV LFCF 84,547.72

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.28
Free cash flow (t + 1) 27,669.09
Terminal Value 440,590.60
Present Value of Terminal Value 296,001.56

Intrinsic Value

Enterprise Value 380,549.28
Net Debt 27,099
Equity Value 353,450.28
Shares Outstanding 423
Equity Value Per Share 835.58