Discounted Cash Flow (DCF) Analysis Levered

Prosperity Bancshares, Inc. (PB)

$76.2

+0.71 (+0.94%)
All numbers are in Millions, Currency in USD
Stock DCF: 174.33 | 76.2 | undervalue

Free Cash Flow

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 716.27727.82796.431,121.941,098.171,234.871,388.591,561.441,755.811,974.38
Revenue (%)
Operating Cash Flow 390.73320.15403.01582.32694.73652.77734.02825.40928.141,043.68
Operating Cash Flow (%)
Capital Expenditure -11.23-15.11-18.59-22.14-19.02-23.92-26.89-30.24-34.01-38.24
Capital Expenditure (%)
Free Cash Flow 379.50305.03384.43560.18675.71628.85707.13795.15894.141,005.44

Weighted Average Cost Of Capital

Share price $ 76.2
Beta 1.020
Diluted Shares Outstanding 92.68
Cost of Debt
Tax Rate 21.28
After-tax Cost of Debt 3.94%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.503
Total Debt -
Total Equity 7,062.44
Total Capital 7,062.44
Debt Weighting 0.00
Equity Weighting 100.00
Wacc

Build Up Free Cash Flow

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 716.27727.82796.431,121.941,098.171,234.871,388.591,561.441,755.811,974.38
Operating Cash Flow 390.73320.15403.01582.32694.73652.77734.02825.40928.141,043.68
Capital Expenditure -11.23-15.11-18.59-22.14-19.02-23.92-26.89-30.24-34.01-38.24
Free Cash Flow 379.50305.03384.43560.18675.71628.85707.13795.15894.141,005.44
WACC
PV LFCF 579.59600.68622.53645.19668.66
SUM PV LFCF 3,116.64

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.50
Free cash flow (t + 1) 1,025.55
Terminal Value 15,777.67
Present Value of Terminal Value 10,492.86

Intrinsic Value

Enterprise Value 13,609.51
Net Debt -2,547.74
Equity Value 16,157.25
Shares Outstanding 92.68
Equity Value Per Share 174.33