Discounted Cash Flow (DCF) Analysis Levered

The Progressive Corporation (PGR)

$134.46

-0.45 (-0.33%)
All numbers are in Millions, Currency in USD
Stock DCF: 634.49 | 134.46 | 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 26,816.1031,954.7038,997.7042,638.1047,676.5055,108.6163,699.2973,629.1485,106.9198,373.91
Revenue (%)
Operating Cash Flow 3,756.806,284.806,261.606,905.607,761.709,060.9010,473.3712,106.0213,993.1816,174.53
Operating Cash Flow (%)
Capital Expenditure -155.70-266-363.50-223.50-243.50-372.54-430.62-497.74-575.33-665.02
Capital Expenditure (%)
Free Cash Flow 3,601.106,018.805,898.106,682.107,518.208,688.3510,042.7511,608.2813,417.8515,509.51

Weighted Average Cost Of Capital

Share price $ 134.46
Beta 0.481
Diluted Shares Outstanding 584.70
Cost of Debt
Tax Rate 20.41
After-tax Cost of Debt 3.55%
Risk-Free Rate
Market Risk Premium
Cost of Equity 5.818
Total Debt 4,898.80
Total Equity 78,618.76
Total Capital 83,517.56
Debt Weighting 5.87
Equity Weighting 94.13
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 26,816.1031,954.7038,997.7042,638.1047,676.5055,108.6163,699.2973,629.1485,106.9198,373.91
Operating Cash Flow 3,756.806,284.806,261.606,905.607,761.709,060.9010,473.3712,106.0213,993.1816,174.53
Capital Expenditure -155.70-266-363.50-223.50-243.50-372.54-430.62-497.74-575.33-665.02
Free Cash Flow 3,601.106,018.805,898.106,682.107,518.208,688.3510,042.7511,608.2813,417.8515,509.51
WACC
PV LFCF 7,361.388,051.598,806.519,632.2110,535.33
SUM PV LFCF 49,572.59

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.68
Free cash flow (t + 1) 15,819.70
Terminal Value 429,883.06
Present Value of Terminal Value 326,126.67

Intrinsic Value

Enterprise Value 375,699.25
Net Debt 4,711.70
Equity Value 370,987.55
Shares Outstanding 584.70
Equity Value Per Share 634.49