Discounted Cash Flow (DCF) Analysis Levered

Best Buy Co., Inc. (BBY)

$86.72

-1.07 (-1.22%)

All numbers are in Millions, Currency in USD

Stock DCF: 166.08 | 86.72 | 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	42,151	42,879	43,638	47,262	51,761	54,520.01	57,426.09	60,487.07	63,711.21	67,107.21
Revenue (%)
Operating Cash Flow	2,141	2,408	2,565	4,927	3,252	3,628.92	3,822.36	4,026.10	4,240.70	4,466.74
Operating Cash Flow (%)
Capital Expenditure	-688	-819	-743	-713	-737	-891.66	-939.19	-989.25	-1,041.98	-1,097.52
Capital Expenditure (%)
Free Cash Flow	1,453	1,589	1,822	4,214	2,515	2,737.26	2,883.17	3,036.85	3,198.72	3,369.22

Weighted Average Cost Of Capital

Share price	$ 86.72
Beta	1.510
Diluted Shares Outstanding	249.30
Cost of Debt
Tax Rate	18.85
After-tax Cost of Debt	0.52%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.769
Total Debt	3,888
Total Equity	21,619.30
Total Capital	25,507.30
Debt Weighting	15.24
Equity Weighting	84.76
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	42,151	42,879	43,638	47,262	51,761	54,520.01	57,426.09	60,487.07	63,711.21	67,107.21
Operating Cash Flow	2,141	2,408	2,565	4,927	3,252	3,628.92	3,822.36	4,026.10	4,240.70	4,466.74
Capital Expenditure	-688	-819	-743	-713	-737	-891.66	-939.19	-989.25	-1,041.98	-1,097.52
Free Cash Flow	1,453	1,589	1,822	4,214	2,515	2,737.26	2,883.17	3,036.85	3,198.72	3,369.22
WACC
PV LFCF						2,506.42	2,417.38	2,331.50	2,248.68	2,168.79
SUM PV LFCF										11,672.78

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	9.21
Free cash flow (t + 1)	3,436.61
Terminal Value	47,664.48
Present Value of Terminal Value	30,681.94

Intrinsic Value

Enterprise Value	42,354.71
Net Debt	952
Equity Value	41,402.71
Shares Outstanding	249.30
Equity Value Per Share	166.08