Discounted Cash Flow (DCF) Analysis Levered

Piedmont Office Realty Trust, Inc. (PDM)

$10.305

-0.38 (-3.60%)

All numbers are in Millions, Currency in USD

Stock DCF: 12.44 | 10.305 | 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	574.17	525.97	533.18	535.02	528.71	518.32	508.14	498.16	488.37	478.77
Revenue (%)
Operating Cash Flow	242.80	202.87	208.48	193.28	242.20	209.30	205.18	201.15	197.20	193.33
Operating Cash Flow (%)
Capital Expenditure	-79.83	-72.11	-103.55	-112.58	-122.63	-94.61	-92.76	-90.93	-89.15	-87.40
Capital Expenditure (%)
Free Cash Flow	162.97	130.76	104.93	80.70	119.58	114.68	112.43	110.22	108.05	105.93

Weighted Average Cost Of Capital

Share price	$ 10.305
Beta	0.959
Diluted Shares Outstanding	123.98
Cost of Debt
Tax Rate	1.20
After-tax Cost of Debt	2.70%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.138
Total Debt	1,877.79
Total Equity	1,277.59
Total Capital	3,155.38
Debt Weighting	59.51
Equity Weighting	40.49
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	574.17	525.97	533.18	535.02	528.71	518.32	508.14	498.16	488.37	478.77
Operating Cash Flow	242.80	202.87	208.48	193.28	242.20	209.30	205.18	201.15	197.20	193.33
Capital Expenditure	-79.83	-72.11	-103.55	-112.58	-122.63	-94.61	-92.76	-90.93	-89.15	-87.40
Free Cash Flow	162.97	130.76	104.93	80.70	119.58	114.68	112.43	110.22	108.05	105.93
WACC
PV LFCF						86.07	80.44	75.17	70.25	65.65
SUM PV LFCF										479.61

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	4.90
Free cash flow (t + 1)	108.05
Terminal Value	3,725.84
Present Value of Terminal Value	2,933.23

Intrinsic Value

Enterprise Value	3,412.84
Net Debt	1,870.37
Equity Value	1,542.47
Shares Outstanding	123.98
Equity Value Per Share	12.44