Discounted Cash Flow (DCF) Analysis Levered

The Gorman-Rupp Company (GRC)

$26.5372

+0.65 (+2.50%)

All numbers are in Millions, Currency in USD

Stock DCF: 37.42 | 26.5372 | undervalue

Free Cash Flow

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	414.33	398.18	348.97	378.32	521.03	559.94	601.76	646.70	695	746.91
Revenue (%)
Operating Cash Flow	41.21	62.17	51.16	45.44	13.68	61.44	66.02	70.95	76.25	81.95
Operating Cash Flow (%)
Capital Expenditure	-10.95	-10.91	-8	-9.75	-17.99	-15.35	-16.49	-17.73	-19.05	-20.47
Capital Expenditure (%)
Free Cash Flow	30.26	51.26	43.16	35.69	-4.30	46.09	49.53	53.23	57.21	61.48

Weighted Average Cost Of Capital

Share price	$ 26.5,372
Beta	0.799
Diluted Shares Outstanding	26.17
Cost of Debt
Tax Rate	19.30
After-tax Cost of Debt	3.55%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.478
Total Debt	436.83
Total Equity	694.53
Total Capital	1,131.36
Debt Weighting	38.61
Equity Weighting	61.39
Wacc

Build Up Free Cash Flow

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	414.33	398.18	348.97	378.32	521.03	559.94	601.76	646.70	695	746.91
Operating Cash Flow	41.21	62.17	51.16	45.44	13.68	61.44	66.02	70.95	76.25	81.95
Capital Expenditure	-10.95	-10.91	-8	-9.75	-17.99	-15.35	-16.49	-17.73	-19.05	-20.47
Free Cash Flow	30.26	51.26	43.16	35.69	-4.30	46.09	49.53	53.23	57.21	61.48
WACC
PV LFCF						43.50	44.12	44.74	45.38	46.03
SUM PV LFCF										223.76

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	5.96
Free cash flow (t + 1)	62.71
Terminal Value	1,583.52
Present Value of Terminal Value	1,185.53

Intrinsic Value

Enterprise Value	1,409.29
Net Debt	430.04
Equity Value	979.25
Shares Outstanding	26.17
Equity Value Per Share	37.42