Discounted Cash Flow (DCF) Analysis Levered

HealthEquity, Inc. (HQY)

$59.26

-1.05 (-1.74%)

All numbers are in Millions, Currency in USD

Stock DCF: 142.37 | 59.26 | 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	229.53	287.24	531.99	733.57	756.56	1,042.87	1,437.54	1,981.57	2,731.48	3,765.19
Revenue (%)
Operating Cash Flow	81.70	113.42	105.01	181.62	140.99	288.28	397.38	547.77	755.07	1,040.82
Operating Cash Flow (%)
Capital Expenditure	-33.38	-15.04	-42.07	-96.96	-137.08	-123.11	-169.71	-233.93	-322.46	-444.50
Capital Expenditure (%)
Free Cash Flow	48.32	98.38	62.94	84.65	3.91	165.17	227.68	313.84	432.61	596.32

Weighted Average Cost Of Capital

Share price	$ 59.26
Beta	0.791
Diluted Shares Outstanding	75.68
Cost of Debt
Tax Rate	33.64
After-tax Cost of Debt	2.41%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.285
Total Debt	1,008.23
Total Equity	4,484.74
Total Capital	5,492.97
Debt Weighting	18.35
Equity Weighting	81.65
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	229.53	287.24	531.99	733.57	756.56	1,042.87	1,437.54	1,981.57	2,731.48	3,765.19
Operating Cash Flow	81.70	113.42	105.01	181.62	140.99	288.28	397.38	547.77	755.07	1,040.82
Capital Expenditure	-33.38	-15.04	-42.07	-96.96	-137.08	-123.11	-169.71	-233.93	-322.46	-444.50
Free Cash Flow	48.32	98.38	62.94	84.65	3.91	165.17	227.68	313.84	432.61	596.32
WACC
PV LFCF						155.25	201.15	260.62	337.67	437.50
SUM PV LFCF										1,392.18

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	6.39
Free cash flow (t + 1)	608.25
Terminal Value	13,855.39
Present Value of Terminal Value	10,165.17

Intrinsic Value

Enterprise Value	11,557.35
Net Debt	782.82
Equity Value	10,774.53
Shares Outstanding	75.68
Equity Value Per Share	142.37