Discounted Cash Flow (DCF) Analysis Levered

Bank of Montreal (BMO.TO)

$121.26

-3.47 (-2.78%)
All numbers are in Millions, Currency in USD
Stock DCF: 2,267.41 | 121.26 | undervalue

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 21,87422,87025,33225,02526,90928,364.4529,898.6231,515.7733,220.3935,017.20
Revenue (%)
Operating Cash Flow 2,90817,91229,30350,83644,04932,569.6534,331.2736,188.1838,145.5240,208.72
Operating Cash Flow (%)
Capital Expenditure -791-886-1,128-1,032-983-1,118.70-1,179.20-1,242.98-1,310.21-1,381.08
Capital Expenditure (%)
Free Cash Flow 2,11717,02628,17549,80443,06631,450.9633,152.0734,945.1936,835.3038,827.64

Weighted Average Cost Of Capital

Share price $ 121.26
Beta 1.161
Diluted Shares Outstanding 648.68
Cost of Debt
Tax Rate 24.41
After-tax Cost of Debt 2.22%
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.283
Total Debt 189,808
Total Equity 78,658.45
Total Capital 268,466.45
Debt Weighting 70.70
Equity Weighting 29.30
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 21,87422,87025,33225,02526,90928,364.4529,898.6231,515.7733,220.3935,017.20
Operating Cash Flow 2,90817,91229,30350,83644,04932,569.6534,331.2736,188.1838,145.5240,208.72
Capital Expenditure -791-886-1,128-1,032-983-1,118.70-1,179.20-1,242.98-1,310.21-1,381.08
Free Cash Flow 2,11717,02628,17549,80443,06631,450.9633,152.0734,945.1936,835.3038,827.64
WACC
PV LFCF 30,157.2130,480.7330,807.7131,138.2031,472.24
SUM PV LFCF 154,056.10

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 4.29
Free cash flow (t + 1) 39,604.19
Terminal Value 1,729,440.76
Present Value of Terminal Value 1,401,820.33

Intrinsic Value

Enterprise Value 1,555,876.43
Net Debt 85,064
Equity Value 1,470,812.43
Shares Outstanding 648.68
Equity Value Per Share 2,267.41