Discounted Cash Flow (DCF) Analysis Levered

Chesapeake Energy Corporation (CHK)

$83.8

+7.46 (+9.77%)

All numbers are in Millions, Currency in USD

Stock DCF: 396.28 | 83.8 | undervalue

Free Cash Flow

Year A/P	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Projected	2022 Projected	2023 Projected	2024 Projected	2025 Projected	2026 Projected
Revenue	9,496	10,231	8,489	5,210	4,377.91	3,678.71	3,091.19	2,597.49	2,182.65	1,834.06
Revenue (%)
Operating Cash Flow	745	2,000	1,623	1,164	753.60	633.24	532.10	447.12	375.71	315.71
Operating Cash Flow (%)
Capital Expenditure	-306	-309	-83	-31	-85.54	-71.88	-60.40	-50.75	-42.65	-35.83
Capital Expenditure (%)
Free Cash Flow	439	1,691	1,540	1,133	668.06	561.36	471.71	396.37	333.07	279.87

Weighted Average Cost Of Capital

Share price	$ 83.8
Beta	2.459
Diluted Shares Outstanding	9.77
Cost of Debt
Tax Rate	0.36
After-tax Cost of Debt	4.98%
Risk-Free Rate
Market Risk Premium
Cost of Equity	14.732
Total Debt	2,307
Total Equity	818.98
Total Capital	3,125.98
Debt Weighting	73.80
Equity Weighting	26.20
Wacc

Build Up Free Cash Flow

Year A/P	2017 Actual	2018 Actual	2019 Actual	2020 Actual	2021 Projected	2022 Projected	2023 Projected	2024 Projected	2025 Projected	2026 Projected
Revenue	9,496	10,231	8,489	5,210	4,377.91	3,678.71	3,091.19	2,597.49	2,182.65	1,834.06
Operating Cash Flow	745	2,000	1,623	1,164	753.60	633.24	532.10	447.12	375.71	315.71
Capital Expenditure	-306	-309	-83	-31	-85.54	-71.88	-60.40	-50.75	-42.65	-35.83
Free Cash Flow	439	1,691	1,540	1,133	668.06	561.36	471.71	396.37	333.07	279.87
WACC
PV LFCF					668.06	522	407.88	318.71	249.03	194.59
SUM PV LFCF										1,692.20

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.54
Free cash flow (t + 1)	285.47
Terminal Value	5,152.88
Present Value of Terminal Value	3,582.61

Intrinsic Value

Enterprise Value	5,274.82
Net Debt	1,402
Equity Value	3,872.82
Shares Outstanding	9.77
Equity Value Per Share	396.28