Discounted Cash Flow (DCF) Analysis Levered

Marcus & Millichap, Inc. (MMI)

$37.02

+0.76 (+2.10%)

All numbers are in Millions, Currency in USD

Stock DCF: 68.01 | 37.02 | 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	814.82	806.43	716.91	1,296.44	1,301.71	1,526.63	1,790.41	2,099.76	2,462.57	2,888.07
Revenue (%)
Operating Cash Flow	117.31	25.29	38.09	255.90	13.63	133.22	156.24	183.23	214.89	252.02
Operating Cash Flow (%)
Capital Expenditure	-8.07	-8.81	-6.94	-6.86	-11.67	-13.67	-16.03	-18.80	-22.05	-25.86
Capital Expenditure (%)
Free Cash Flow	109.24	16.48	31.14	249.05	1.96	119.55	140.21	164.43	192.84	226.16

Weighted Average Cost Of Capital

Share price	$ 37.02
Beta	1.188
Diluted Shares Outstanding	40.19
Cost of Debt
Tax Rate	26.62
After-tax Cost of Debt	3.12%
Risk-Free Rate
Market Risk Premium
Cost of Equity	9.862
Total Debt	82.09
Total Equity	1,487.69
Total Capital	1,569.78
Debt Weighting	5.23
Equity Weighting	94.77
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	814.82	806.43	716.91	1,296.44	1,301.71	1,526.63	1,790.41	2,099.76	2,462.57	2,888.07
Operating Cash Flow	117.31	25.29	38.09	255.90	13.63	133.22	156.24	183.23	214.89	252.02
Capital Expenditure	-8.07	-8.81	-6.94	-6.86	-11.67	-13.67	-16.03	-18.80	-22.05	-25.86
Free Cash Flow	109.24	16.48	31.14	249.05	1.96	119.55	140.21	164.43	192.84	226.16
WACC
PV LFCF						109.17	116.91	125.21	134.09	143.60
SUM PV LFCF										628.97

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	9.51
Free cash flow (t + 1)	230.69
Terminal Value	3,071.73
Present Value of Terminal Value	1,950.35

Intrinsic Value

Enterprise Value	2,579.33
Net Debt	-153.76
Equity Value	2,733.09
Shares Outstanding	40.19
Equity Value Per Share	68.01