Discounted Cash Flow (DCF) Analysis Levered

Equity Residential (EQR)

$66.18

+0.95 (+1.46%)

All numbers are in Millions, Currency in USD

Stock DCF: 50.31 | 66.18 | overvalue

Free Cash Flow

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	2,701.07	2,571.70	2,464	2,735.18	2,753.67	2,772.29	2,791.03	2,809.89	2,828.89
Revenue (%)
Operating Cash Flow	1,456.98	1,265.54	1,260.18	1,454.76	1,428.34	1,438	1,447.72	1,457.50	1,467.36
Operating Cash Flow (%)
Capital Expenditure	-183.38	-156.08	-152.72	-221.09	-186.83	-188.09	-189.36	-190.64	-191.93
Capital Expenditure (%)
Free Cash Flow	1,273.61	1,109.46	1,107.47	1,233.67	1,241.51	1,249.90	1,258.35	1,266.86	1,275.42

Weighted Average Cost Of Capital

Share price	$ 66.18
Beta	0.832
Diluted Shares Outstanding	388.37
Cost of Debt
Tax Rate	4.81
After-tax Cost of Debt	4.76%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.673
Total Debt	2,392.14
Total Equity	25,702.59
Total Capital	28,094.73
Debt Weighting	8.51
Equity Weighting	91.49
Wacc

Build Up Free Cash Flow

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	2,701.07	2,571.70	2,464	2,735.18	2,753.67	2,772.29	2,791.03	2,809.89	2,828.89
Operating Cash Flow	1,456.98	1,265.54	1,260.18	1,454.76	1,428.34	1,438	1,447.72	1,457.50	1,467.36
Capital Expenditure	-183.38	-156.08	-152.72	-221.09	-186.83	-188.09	-189.36	-190.64	-191.93
Free Cash Flow	1,273.61	1,109.46	1,107.47	1,233.67	1,241.51	1,249.90	1,258.35	1,266.86	1,275.42
WACC
PV LFCF					1,155.75	1,083.19	1,015.19	951.45	891.72
SUM PV LFCF									5,097.31

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.42
Free cash flow (t + 1)	1,300.93
Terminal Value	24,002.43
Present Value of Terminal Value	16,781.45

Intrinsic Value

Enterprise Value	21,878.76
Net Debt	2,338.27
Equity Value	19,540.48
Shares Outstanding	388.37
Equity Value Per Share	50.31