Discounted Cash Flow (DCF) Analysis Levered

Fifth Third Bancorp (FITB)

$39.11

+0.50 (+1.30%)

All numbers are in Millions, Currency in USD

Stock DCF: 53.35 | 39.11 | 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	5,729	6,151	7,253	7,373	7,646	8,231.66	8,862.19	9,541.01	10,271.83	11,058.63
Revenue (%)
Operating Cash Flow	1,494	2,856	1,824	371	2,704	2,272.83	2,446.93	2,634.36	2,836.14	3,053.38
Operating Cash Flow (%)
Capital Expenditure	-231	-134	-304	-358	-309	-317.72	-342.06	-368.26	-396.47	-426.84
Capital Expenditure (%)
Free Cash Flow	1,263	2,722	1,520	13	2,395	1,955.11	2,104.87	2,266.09	2,439.67	2,626.54

Weighted Average Cost Of Capital

Share price	$ 39.11
Beta	1.321
Diluted Shares Outstanding	697.53
Cost of Debt
Tax Rate	21.24
After-tax Cost of Debt	2.94%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.980
Total Debt	11,821
Total Equity	27,280.48
Total Capital	39,101.48
Debt Weighting	30.23
Equity Weighting	69.77
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	5,729	6,151	7,253	7,373	7,646	8,231.66	8,862.19	9,541.01	10,271.83	11,058.63
Operating Cash Flow	1,494	2,856	1,824	371	2,704	2,272.83	2,446.93	2,634.36	2,836.14	3,053.38
Capital Expenditure	-231	-134	-304	-358	-309	-317.72	-342.06	-368.26	-396.47	-426.84
Free Cash Flow	1,263	2,722	1,520	13	2,395	1,955.11	2,104.87	2,266.09	2,439.67	2,626.54
WACC
PV LFCF						1,824.65	1,833.33	1,842.05	1,850.81	1,859.62
SUM PV LFCF										9,210.46

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.15
Free cash flow (t + 1)	2,679.07
Terminal Value	52,020.87
Present Value of Terminal Value	36,831.27

Intrinsic Value

Enterprise Value	46,041.73
Net Debt	8,827
Equity Value	37,214.73
Shares Outstanding	697.53
Equity Value Per Share	53.35