Discounted Cash Flow (DCF) Analysis Levered

MGIC Investment Corporation (MTG)

$15.86

-0.03 (-0.19%)

All numbers are in Millions, Currency in USD

Stock DCF: 25.55 | 15.86 | 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	1,123.85	1,213.98	1,199.15	1,185.68	1,172.79	1,186.24	1,199.84	1,213.60	1,227.52	1,241.60
Revenue (%)
Operating Cash Flow	544.52	609.53	732.31	696.32	650.01	649.78	657.23	664.77	672.39	680.10
Operating Cash Flow (%)
Capital Expenditure	-14.24	-5.64	-3.31	-4.12	-3.25	-6.24	-6.32	-6.39	-6.46	-6.54
Capital Expenditure (%)
Free Cash Flow	530.28	603.90	729	692.20	646.76	643.53	650.91	658.38	665.93	673.57

Weighted Average Cost Of Capital

Share price	$ 15.86
Beta	1.337
Diluted Shares Outstanding	311.23
Cost of Debt
Tax Rate	20.61
After-tax Cost of Debt	5.76%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.060
Total Debt	662.81
Total Equity	4,936.09
Total Capital	5,598.90
Debt Weighting	11.84
Equity Weighting	88.16
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	1,123.85	1,213.98	1,199.15	1,185.68	1,172.79	1,186.24	1,199.84	1,213.60	1,227.52	1,241.60
Operating Cash Flow	544.52	609.53	732.31	696.32	650.01	649.78	657.23	664.77	672.39	680.10
Capital Expenditure	-14.24	-5.64	-3.31	-4.12	-3.25	-6.24	-6.32	-6.39	-6.46	-6.54
Free Cash Flow	530.28	603.90	729	692.20	646.76	643.53	650.91	658.38	665.93	673.57
WACC
PV LFCF						587.43	542.37	500.77	462.36	426.89
SUM PV LFCF										2,519.83

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	9.55
Free cash flow (t + 1)	687.04
Terminal Value	9,099.84
Present Value of Terminal Value	5,767.29

Intrinsic Value

Enterprise Value	8,287.12
Net Debt	335.43
Equity Value	7,951.69
Shares Outstanding	311.23
Equity Value Per Share	25.55