Discounted Cash Flow (DCF) Analysis Levered

International Paper Company (IP)

$40.785

-0.58 (-1.39%)
All numbers are in Millions, Currency in USD
Stock DCF: 56.84 | 40.785 | 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 23,30622,37620,58019,36321,16120,703.6820,256.2419,818.4719,390.1718,971.12
Revenue (%)
Operating Cash Flow 3,2263,6103,0632,0302,1742,716.992,658.282,600.832,544.622,489.62
Operating Cash Flow (%)
Capital Expenditure -1,572-1,276-751-549-1,001.55-979.91-958.73-938.01-917.74-897.91
Capital Expenditure (%)
Free Cash Flow 1,6542,3342,3121,4811,172.451,737.091,699.541,662.811,626.881,591.72

Weighted Average Cost Of Capital

Share price $ 40.785
Beta 0.975
Diluted Shares Outstanding 392.40
Cost of Debt
Tax Rate 0.46
After-tax Cost of Debt 5.51%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.218
Total Debt 5,862
Total Equity 16,004.03
Total Capital 21,866.03
Debt Weighting 26.81
Equity Weighting 73.19
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 23,30622,37620,58019,36321,16120,703.6820,256.2419,818.4719,390.1718,971.12
Operating Cash Flow 3,2263,6103,0632,0302,1742,716.992,658.282,600.832,544.622,489.62
Capital Expenditure -1,572-1,276-751-549-1,001.55-979.91-958.73-938.01-917.74-897.91
Free Cash Flow 1,6542,3342,3121,4811,172.451,737.091,699.541,662.811,626.881,591.72
WACC
PV LFCF 1,126.191,025.08933.04849.26773.01
SUM PV LFCF 6,753.76

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.49
Free cash flow (t + 1) 1,623.55
Terminal Value 29,572.93
Present Value of Terminal Value 20,608.86

Intrinsic Value

Enterprise Value 27,362.63
Net Debt 5,058
Equity Value 22,304.63
Shares Outstanding 392.40
Equity Value Per Share 56.84