Discounted Cash Flow (DCF) Analysis Levered

Diversified Healthcare Trust (DHC)

$0.8451

-0.15 (-15.06%)

All numbers are in Millions, Currency in USD

Stock DCF: 14.53 | 0.8451 | 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	1,074.82	1,117.16	1,040.16	1,632.03	1,383.21	1,517.05	1,663.83	1,824.82	2,001.39	2,195.04
Revenue (%)
Operating Cash Flow	407.05	392.84	265.84	158.54	-63.32	314.73	345.18	378.58	415.21	455.38
Operating Cash Flow (%)
Capital Expenditure	-221.43	99.09	-18.81	-73.66	-62.43	-68.47	-75.10	-82.37	-90.33	-99.07
Capital Expenditure (%)
Free Cash Flow	185.62	491.93	247.03	84.88	-125.76	246.25	270.08	296.21	324.87	356.31

Weighted Average Cost Of Capital

Share price	$ 0.8,451
Beta	1.602
Diluted Shares Outstanding	237.74
Cost of Debt
Tax Rate	3.77
After-tax Cost of Debt	6.69%
Risk-Free Rate
Market Risk Premium
Cost of Equity	11.160
Total Debt	3,679.08
Total Equity	200.91
Total Capital	3,879.99
Debt Weighting	94.82
Equity Weighting	5.18
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	1,074.82	1,117.16	1,040.16	1,632.03	1,383.21	1,517.05	1,663.83	1,824.82	2,001.39	2,195.04
Operating Cash Flow	407.05	392.84	265.84	158.54	-63.32	314.73	345.18	378.58	415.21	455.38
Capital Expenditure	-221.43	99.09	-18.81	-73.66	-62.43	-68.47	-75.10	-82.37	-90.33	-99.07
Free Cash Flow	185.62	491.93	247.03	84.88	-125.76	246.25	270.08	296.21	324.87	356.31
WACC
PV LFCF						230.32	236.25	242.34	248.59	254.99
SUM PV LFCF										1,212.49

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	6.92
Free cash flow (t + 1)	363.43
Terminal Value	7,386.88
Present Value of Terminal Value	5,286.48

Intrinsic Value

Enterprise Value	6,498.97
Net Debt	3,044.23
Equity Value	3,454.74
Shares Outstanding	237.74
Equity Value Per Share	14.53