Discounted Cash Flow (DCF) Analysis Levered

Fairfax Financial Holdings Limited (FFH.TO)

$654.05

-11.65 (-1.75%)
All numbers are in Millions, Currency in USD
Stock DCF: 3,140.08 | 654.05 | 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 14,005.6016,507.8021,18119,843.5025,801.9030,309.9535,605.6341,826.5749,134.4157,719.07
Revenue (%)
Operating Cash Flow 2,700.60-1,924.301,355.40139.806,6412,453.132,881.743,385.233,976.694,671.48
Operating Cash Flow (%)
Capital Expenditure -415.20-236.50-319.60-273.30-353.90-524.66-616.33-724.02-850.51-999.11
Capital Expenditure (%)
Free Cash Flow 2,285.40-2,160.801,035.80-133.506,287.101,928.472,265.412,661.213,126.173,672.37

Weighted Average Cost Of Capital

Share price $ 654.05
Beta 0.937
Diluted Shares Outstanding 27.82
Cost of Debt
Tax Rate 22.57
After-tax Cost of Debt 5.13%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.270
Total Debt 7,753
Total Equity 18,196.23
Total Capital 25,949.23
Debt Weighting 29.88
Equity Weighting 70.12
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 14,005.6016,507.8021,18119,843.5025,801.9030,309.9535,605.6341,826.5749,134.4157,719.07
Operating Cash Flow 2,700.60-1,924.301,355.40139.806,6412,453.132,881.743,385.233,976.694,671.48
Capital Expenditure -415.20-236.50-319.60-273.30-353.90-524.66-616.33-724.02-850.51-999.11
Free Cash Flow 2,285.40-2,160.801,035.80-133.506,287.101,928.472,265.412,661.213,126.173,672.37
WACC
PV LFCF 1,808.561,992.452,195.032,418.222,664.09
SUM PV LFCF 11,078.36

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.63
Free cash flow (t + 1) 3,745.82
Terminal Value 80,903.22
Present Value of Terminal Value 58,690.63

Intrinsic Value

Enterprise Value 69,768.98
Net Debt -17,590.80
Equity Value 87,359.78
Shares Outstanding 27.82
Equity Value Per Share 3,140.08