Discounted Cash Flow (DCF) Analysis Levered

Morningstar, Inc. (MORN)

$183.71

+0.07 (+0.04%)

All numbers are in Millions, Currency in USD

Stock DCF: 241.21 | 183.71 | 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	1,019.90	1,179	1,389.50	1,699.30	1,870.60	2,178.45	2,536.97	2,954.50	3,440.73	4,006.99
Revenue (%)
Operating Cash Flow	314.80	334.40	384.30	449.90	297.80	563.27	655.97	763.93	889.65	1,036.06
Operating Cash Flow (%)
Capital Expenditure	-76.10	-80	-76.70	-101.80	-129.50	-142.39	-165.82	-193.11	-224.89	-261.90
Capital Expenditure (%)
Free Cash Flow	238.70	254.40	307.60	348.10	168.30	420.88	490.15	570.82	664.76	774.16

Weighted Average Cost Of Capital

Share price	$ 183.71
Beta	1.194
Diluted Shares Outstanding	42.90
Cost of Debt
Tax Rate	46.02
After-tax Cost of Debt	1.16%
Risk-Free Rate
Market Risk Premium
Cost of Equity	9.117
Total Debt	1,323.60
Total Equity	7,881.16
Total Capital	9,204.76
Debt Weighting	14.38
Equity Weighting	85.62
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	1,019.90	1,179	1,389.50	1,699.30	1,870.60	2,178.45	2,536.97	2,954.50	3,440.73	4,006.99
Operating Cash Flow	314.80	334.40	384.30	449.90	297.80	563.27	655.97	763.93	889.65	1,036.06
Capital Expenditure	-76.10	-80	-76.70	-101.80	-129.50	-142.39	-165.82	-193.11	-224.89	-261.90
Free Cash Flow	238.70	254.40	307.60	348.10	168.30	420.88	490.15	570.82	664.76	774.16
WACC
PV LFCF						389.81	420.46	453.51	489.16	527.61
SUM PV LFCF										2,280.56

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.97
Free cash flow (t + 1)	789.65
Terminal Value	13,226.89
Present Value of Terminal Value	9,014.51

Intrinsic Value

Enterprise Value	11,295.07
Net Debt	947
Equity Value	10,348.07
Shares Outstanding	42.90
Equity Value Per Share	241.21