Discounted Cash Flow (DCF) Analysis Levered

Alibaba Group Holding Limited (BABA)

$86.9

+0.38 (+0.44%)

All numbers are in Millions, Currency in USD

Stock DCF: 1,042.10 | 86.9 | 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	40,042.56	60,295.04	81,553.76	114,766.24	136,489.92	186,134.20	253,835.16	346,160.40	472,066.28	643,766.80
Revenue (%)
Operating Cash Flow	20,027.36	24,156	28,897.12	37,085.76	22,841.44	64,983.34	88,619.16	120,851.84	164,808.21	224,752.46
Operating Cash Flow (%)
Capital Expenditure	-4,773.76	-7,942.88	-7,261.76	-6,909.60	-8,531.84	-17,225.16	-23,490.32	-32,034.24	-43,685.78	-59,575.22
Capital Expenditure (%)
Free Cash Flow	15,253.60	16,213.12	21,635.36	30,176.16	14,309.60	47,758.18	65,128.85	88,817.59	121,122.43	165,177.23

Weighted Average Cost Of Capital

Share price	$ 86.9
Beta	0.630
Diluted Shares Outstanding	2,723.38
Cost of Debt
Tax Rate	-4.53
After-tax Cost of Debt	11.67%
Risk-Free Rate
Market Risk Premium
Cost of Equity	6.352
Total Debt	28,255.52
Total Equity	236,661.29
Total Capital	264,916.81
Debt Weighting	10.67
Equity Weighting	89.33
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	40,042.56	60,295.04	81,553.76	114,766.24	136,489.92	186,134.20	253,835.16	346,160.40	472,066.28	643,766.80
Operating Cash Flow	20,027.36	24,156	28,897.12	37,085.76	22,841.44	64,983.34	88,619.16	120,851.84	164,808.21	224,752.46
Capital Expenditure	-4,773.76	-7,942.88	-7,261.76	-6,909.60	-8,531.84	-17,225.16	-23,490.32	-32,034.24	-43,685.78	-59,575.22
Free Cash Flow	15,253.60	16,213.12	21,635.36	30,176.16	14,309.60	47,758.18	65,128.85	88,817.59	121,122.43	165,177.23
WACC
PV LFCF						41,776.29	53,283.97	67,961.54	86,682.18	110,559.61
SUM PV LFCF										385,193.83

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	6.92
Free cash flow (t + 1)	168,480.78
Terminal Value	3,424,406.08
Present Value of Terminal Value	2,450,702.02

Intrinsic Value

Enterprise Value	2,835,895.85
Net Debt	-2,128.16
Equity Value	2,838,024.01
Shares Outstanding	2,723.38
Equity Value Per Share	1,042.10