Discounted Cash Flow (DCF) Analysis Levered

Central Pacific Financial Corp. (CPF)

$23.79

+0.49 (+2.10%)

All numbers are in Millions, Currency in USD

Stock DCF: 73.30 | 23.79 | 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	203.60	207.56	221.77	238.47	254.11	268.64	284.01	300.25	317.43	335.59
Revenue (%)
Operating Cash Flow	96.78	103.49	72.19	76.79	110.49	110.48	116.80	123.48	130.55	138.01
Operating Cash Flow (%)
Capital Expenditure	-6.53	-3.22	-7.20	-26	-22.16	-14.84	-15.69	-16.59	-17.54	-18.54
Capital Expenditure (%)
Free Cash Flow	90.25	100.26	65	50.79	88.33	95.64	101.11	106.89	113.01	119.47

Weighted Average Cost Of Capital

Share price	$ 23.79
Beta	1.111
Diluted Shares Outstanding	28.05
Cost of Debt
Tax Rate	24.38
After-tax Cost of Debt	3.99%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.624
Total Debt	146.35
Total Equity	667.21
Total Capital	813.56
Debt Weighting	17.99
Equity Weighting	82.01
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	203.60	207.56	221.77	238.47	254.11	268.64	284.01	300.25	317.43	335.59
Operating Cash Flow	96.78	103.49	72.19	76.79	110.49	110.48	116.80	123.48	130.55	138.01
Capital Expenditure	-6.53	-3.22	-7.20	-26	-22.16	-14.84	-15.69	-16.59	-17.54	-18.54
Free Cash Flow	90.25	100.26	65	50.79	88.33	95.64	101.11	106.89	113.01	119.47
WACC
PV LFCF						88.73	87.02	85.35	83.71	82.10
SUM PV LFCF										426.91

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.79
Free cash flow (t + 1)	121.86
Terminal Value	2,104.65
Present Value of Terminal Value	1,446.40

Intrinsic Value

Enterprise Value	1,873.31
Net Debt	-182.56
Equity Value	2,055.87
Shares Outstanding	28.05
Equity Value Per Share	73.30