Discounted Cash Flow (DCF) Analysis Levered

First American Financial Corporatio... (FAF)

$44.97

-0.13 (-0.29%)
All numbers are in Millions, Currency in USD
Stock DCF: 288.32 | 44.97 | 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 5,772.365,747.846,199.237,080.959,21410,406.6411,753.6613,275.0314,993.3216,934.03
Revenue (%)
Operating Cash Flow 632.13793.16913.091,084.661,2201,416.101,599.401,806.422,040.242,304.32
Operating Cash Flow (%)
Capital Expenditure -134.21-118.17-106.98-114.08-161-197-222.50-251.30-283.82-320.56
Capital Expenditure (%)
Free Cash Flow 497.93675806.11970.571,0591,219.101,376.901,555.121,756.411,983.76

Weighted Average Cost Of Capital

Share price $ 44.97
Beta 1.229
Diluted Shares Outstanding 111.37
Cost of Debt
Tax Rate 24.42
After-tax Cost of Debt 2.21%
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.763
Total Debt 2,460
Total Equity 5,008.22
Total Capital 7,468.22
Debt Weighting 32.94
Equity Weighting 67.06
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 5,772.365,747.846,199.237,080.959,21410,406.6411,753.6613,275.0314,993.3216,934.03
Operating Cash Flow 632.13793.16913.091,084.661,2201,416.101,599.401,806.422,040.242,304.32
Capital Expenditure -134.21-118.17-106.98-114.08-161-197-222.50-251.30-283.82-320.56
Free Cash Flow 497.93675806.11970.571,0591,219.101,376.901,555.121,756.411,983.76
WACC
PV LFCF 1,136.371,196.371,259.531,326.021,396.03
SUM PV LFCF 6,314.32

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.28
Free cash flow (t + 1) 2,023.43
Terminal Value 38,322.61
Present Value of Terminal Value 26,968.78

Intrinsic Value

Enterprise Value 33,283.10
Net Debt 1,174
Equity Value 32,109.10
Shares Outstanding 111.37
Equity Value Per Share 288.32