Discounted Cash Flow (DCF) Analysis Levered

Employers Holdings, Inc. (EIG)

$37.65

-0.32 (-0.84%)

All numbers are in Millions, Currency in USD

Stock DCF: 65.79 | 37.65 | undervalue

Free Cash Flow

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	800.40	835.90	711.40	703.10	713.50	695.40	677.76	660.57	643.81	627.48
Revenue (%)
Operating Cash Flow	180.20	123.10	33.30	10.80	99.80	79.89	77.87	75.89	73.97	72.09
Operating Cash Flow (%)
Capital Expenditure	-10.20	-12.10	-5.50	-3.60	-2.60	-6.08	-5.93	-5.78	-5.63	-5.49
Capital Expenditure (%)
Free Cash Flow	170	111	27.80	7.20	97.20	73.81	71.94	70.12	68.34	66.61

Weighted Average Cost Of Capital

Share price	$ 37.65
Beta	0.253
Diluted Shares Outstanding	28.60
Cost of Debt
Tax Rate	13.26
After-tax Cost of Debt	3.66%
Risk-Free Rate
Market Risk Premium
Cost of Equity	5.413
Total Debt	182.50
Total Equity	1,076.83
Total Capital	1,259.33
Debt Weighting	14.49
Equity Weighting	85.51
Wacc

Build Up Free Cash Flow

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	800.40	835.90	711.40	703.10	713.50	695.40	677.76	660.57	643.81	627.48
Operating Cash Flow	180.20	123.10	33.30	10.80	99.80	79.89	77.87	75.89	73.97	72.09
Capital Expenditure	-10.20	-12.10	-5.50	-3.60	-2.60	-6.08	-5.93	-5.78	-5.63	-5.49
Free Cash Flow	170	111	27.80	7.20	97.20	73.81	71.94	70.12	68.34	66.61
WACC
PV LFCF						70.19	65.06	60.29	55.88	51.79
SUM PV LFCF										303.21

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	5.16
Free cash flow (t + 1)	67.94
Terminal Value	2,149.91
Present Value of Terminal Value	1,671.74

Intrinsic Value

Enterprise Value	1,974.95
Net Debt	93.30
Equity Value	1,881.65
Shares Outstanding	28.60
Equity Value Per Share	65.79