Discounted Cash Flow (DCF) Analysis Levered

CapStar Financial Holdings, Inc. (CSTR)

$19

-0.24 (-1.25%)
All numbers are in Millions, Currency in USD
Stock DCF: 29.47 | 19 | 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 52.7767.1592.02119.57133.85169.38214.33271.22343.21434.30
Revenue (%)
Operating Cash Flow -16.6133.36-84.6924.05116.3611.2514.2418.0222.8028.86
Operating Cash Flow (%)
Capital Expenditure -1.08-4.24-1.58-0.42-3.49-4.41-5.59-7.07-8.94-11.32
Capital Expenditure (%)
Free Cash Flow -17.6929.12-86.2723.63112.886.848.6510.9513.8617.54

Weighted Average Cost Of Capital

Share price $ 19
Beta 0.952
Diluted Shares Outstanding 20.19
Cost of Debt
Tax Rate 20.69
After-tax Cost of Debt 19.57%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.191
Total Debt 29.53
Total Equity 383.53
Total Capital 413.06
Debt Weighting 7.15
Equity Weighting 92.85
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 52.7767.1592.02119.57133.85169.38214.33271.22343.21434.30
Operating Cash Flow -16.6133.36-84.6924.05116.3611.2514.2418.0222.8028.86
Capital Expenditure -1.08-4.24-1.58-0.42-3.49-4.41-5.59-7.07-8.94-11.32
Free Cash Flow -17.6929.12-86.2723.63112.886.848.6510.9513.8617.54
WACC
PV LFCF 4.855.636.537.588.80
SUM PV LFCF 43.23

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 9.00
Free cash flow (t + 1) 17.89
Terminal Value 255.54
Present Value of Terminal Value 166.09

Intrinsic Value

Enterprise Value 209.32
Net Debt -385.59
Equity Value 594.91
Shares Outstanding 20.19
Equity Value Per Share 29.47