Discounted Cash Flow (DCF) Analysis Levered

Enghouse Systems Limited (ENGH.TO)

$33.24

+0.05 (+0.15%)

All numbers are in Millions, Currency in USD

Stock DCF: 67.77 | 33.24 | 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	325.37	342.84	385.85	503.78	467.18	515.31	568.40	626.97	691.57	762.82
Revenue (%)
Operating Cash Flow	83.24	98.25	81.38	168.14	118.46	138.17	152.41	168.11	185.43	204.54
Operating Cash Flow (%)
Capital Expenditure	-3.16	-2.24	-2.16	-2.54	-3.33	-3.51	-3.87	-4.27	-4.71	-5.19
Capital Expenditure (%)
Free Cash Flow	80.08	96.01	79.22	165.61	115.13	134.66	148.54	163.84	180.72	199.34

Weighted Average Cost Of Capital

Share price	$ 33.24
Beta	0.894
Diluted Shares Outstanding	55.06
Cost of Debt
Tax Rate	13.61
After-tax Cost of Debt	3.50%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.061
Total Debt	25.60
Total Equity	1,830.26
Total Capital	1,855.86
Debt Weighting	1.38
Equity Weighting	98.62
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	325.37	342.84	385.85	503.78	467.18	515.31	568.40	626.97	691.57	762.82
Operating Cash Flow	83.24	98.25	81.38	168.14	118.46	138.17	152.41	168.11	185.43	204.54
Capital Expenditure	-3.16	-2.24	-2.16	-2.54	-3.33	-3.51	-3.87	-4.27	-4.71	-5.19
Free Cash Flow	80.08	96.01	79.22	165.61	115.13	134.66	148.54	163.84	180.72	199.34
WACC
PV LFCF						125.84	129.71	133.71	137.82	142.06
SUM PV LFCF										669.15

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.01
Free cash flow (t + 1)	203.33
Terminal Value	4,058.50
Present Value of Terminal Value	2,892.30

Intrinsic Value

Enterprise Value	3,561.45
Net Debt	-170.29
Equity Value	3,731.74
Shares Outstanding	55.06
Equity Value Per Share	67.77