Discounted Cash Flow (DCF) Analysis Levered

Equity Residential (EQR)

$72.93

+0.71 (+0.98%)
All numbers are in Millions, Currency in USD
Stock DCF: 45.56 | 72.93 | overvalue

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 2,471.412,578.432,701.072,571.702,4642,464.672,465.342,466.022,466.692,467.37
Revenue (%)
Operating Cash Flow 1,265.791,356.301,456.981,265.541,260.181,272.331,272.681,273.031,273.371,273.72
Operating Cash Flow (%)
Capital Expenditure -204.11-193.01-183.38-156.08-152.72-171.54-171.59-171.64-171.68-171.73
Capital Expenditure (%)
Free Cash Flow 1,061.671,163.291,273.611,109.461,107.471,100.791,101.091,101.391,101.691,101.99

Weighted Average Cost Of Capital

Share price $ 72.93
Beta 0.829
Diluted Shares Outstanding 388.37
Cost of Debt
Tax Rate 4.87
After-tax Cost of Debt 3.00%
Risk-Free Rate
Market Risk Premium
Cost of Equity 6.802
Total Debt 8,653.79
Total Equity 28,324.12
Total Capital 36,977.90
Debt Weighting 23.40
Equity Weighting 76.60
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 2,471.412,578.432,701.072,571.702,4642,464.672,465.342,466.022,466.692,467.37
Operating Cash Flow 1,265.791,356.301,456.981,265.541,260.181,272.331,272.681,273.031,273.371,273.72
Capital Expenditure -204.11-193.01-183.38-156.08-152.72-171.54-171.59-171.64-171.68-171.73
Free Cash Flow 1,061.671,163.291,273.611,109.461,107.471,100.791,101.091,101.391,101.691,101.99
WACC
PV LFCF 1,039.36981.63927.11875.61826.98
SUM PV LFCF 4,650.68

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.91
Free cash flow (t + 1) 1,124.03
Terminal Value 28,747.58
Present Value of Terminal Value 21,573.29

Intrinsic Value

Enterprise Value 26,223.98
Net Debt 8,529.96
Equity Value 17,694.02
Shares Outstanding 388.37
Equity Value Per Share 45.56