Discounted Cash Flow (DCF) Analysis Levered

International Paper Company (IP)

$36.52

-0.58 (-1.56%)
All numbers are in Millions, Currency in USD
Stock DCF: 42.12 | 36.52 | 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 21,74323,30622,37620,58019,36318,843.0118,336.9917,844.5617,365.3516,899.01
Revenue (%)
Operating Cash Flow 1,7573,2263,6103,0632,0302,390.172,325.992,263.522,202.742,143.58
Operating Cash Flow (%)
Capital Expenditure -1,391-1,572-1,276-751-549-954.57-928.93-903.99-879.71-856.09
Capital Expenditure (%)
Free Cash Flow 3661,6542,3342,3121,4811,435.611,397.051,359.541,323.031,287.50

Weighted Average Cost Of Capital

Share price $ 36.52
Beta 0.989
Diluted Shares Outstanding 392.40
Cost of Debt
Tax Rate -75.38
After-tax Cost of Debt 5.43%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.265
Total Debt 7,914
Total Equity 14,330.45
Total Capital 22,244.45
Debt Weighting 35.58
Equity Weighting 64.42
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 21,74323,30622,37620,58019,36318,843.0118,336.9917,844.5617,365.3516,899.01
Operating Cash Flow 1,7573,2263,6103,0632,0302,390.172,325.992,263.522,202.742,143.58
Capital Expenditure -1,391-1,572-1,276-751-549-954.57-928.93-903.99-879.71-856.09
Free Cash Flow 3661,6542,3342,3121,4811,435.611,397.051,359.541,323.031,287.50
WACC
PV LFCF 1,084.64984.06892.82810.03734.93
SUM PV LFCF 5,560.97

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.26
Free cash flow (t + 1) 1,313.25
Terminal Value 24,966.66
Present Value of Terminal Value 17,586.18

Intrinsic Value

Enterprise Value 23,147.15
Net Debt 6,619
Equity Value 16,528.15
Shares Outstanding 392.40
Equity Value Per Share 42.12