Discounted Cash Flow (DCF) Analysis Levered

McKesson Corporation (MCK)

$382.99

+0.55 (+0.14%)
All numbers are in Millions, Currency in USD
Stock DCF: 823.21 | 382.99 | 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 208,357214,319231,051238,228263,966280,185.83297,402.31315,676.69335,073.97355,663.15
Revenue (%)
Operating Cash Flow 4,3454,0364,3744,5424,4345,294.375,619.695,9656,331.536,720.59
Operating Cash Flow (%)
Capital Expenditure -580-557-506-641-535-688.70-731.02-775.94-823.62-874.23
Capital Expenditure (%)
Free Cash Flow 3,7653,4793,8683,9013,8994,605.674,888.675,189.075,507.925,846.36

Weighted Average Cost Of Capital

Share price $ 382.99
Beta 0.655
Diluted Shares Outstanding 154.10
Cost of Debt
Tax Rate 42.22
After-tax Cost of Debt 1.36%
Risk-Free Rate
Market Risk Premium
Cost of Equity 6.669
Total Debt 7,542
Total Equity 59,018.76
Total Capital 66,560.76
Debt Weighting 11.33
Equity Weighting 88.67
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 208,357214,319231,051238,228263,966280,185.83297,402.31315,676.69335,073.97355,663.15
Operating Cash Flow 4,3454,0364,3744,5424,4345,294.375,619.695,9656,331.536,720.59
Capital Expenditure -580-557-506-641-535-688.70-731.02-775.94-823.62-874.23
Free Cash Flow 3,7653,4793,8683,9013,8994,605.674,888.675,189.075,507.925,846.36
WACC
PV LFCF 3,233.983,236.263,238.533,240.813,243.10
SUM PV LFCF 21,741.11

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.07
Free cash flow (t + 1) 5,963.29
Terminal Value 146,518.08
Present Value of Terminal Value 109,126.04

Intrinsic Value

Enterprise Value 130,867.14
Net Debt 4,010
Equity Value 126,857.14
Shares Outstanding 154.10
Equity Value Per Share 823.21