Discounted Cash Flow (DCF) Analysis Levered

Polaris Inc. (PII)

$112.38

-0.40 (-0.35%)
All numbers are in Millions, Currency in USD
Stock DCF: 138.92 | 112.38 | 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 5,428.486,078.546,782.527,027.908,198.209,096.4510,093.1111,198.9712,42613,787.47
Revenue (%)
Operating Cash Flow 579.98477.11655.041,018.60293.70841.73933.961,036.291,149.831,275.81
Operating Cash Flow (%)
Capital Expenditure -184.39-225.41-251.37-213.90-298.30-318.26-353.13-391.82-434.75-482.38
Capital Expenditure (%)
Free Cash Flow 395.59251.70403.66804.70-4.60523.47580.83644.47715.08793.43

Weighted Average Cost Of Capital

Share price $ 112.38
Beta 1.522
Diluted Shares Outstanding 62.70
Cost of Debt
Tax Rate 21.06
After-tax Cost of Debt 1.78%
Risk-Free Rate
Market Risk Premium
Cost of Equity 10.875
Total Debt 1,968.50
Total Equity 7,046.23
Total Capital 9,014.73
Debt Weighting 21.84
Equity Weighting 78.16
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 5,428.486,078.546,782.527,027.908,198.209,096.4510,093.1111,198.9712,42613,787.47
Operating Cash Flow 579.98477.11655.041,018.60293.70841.73933.961,036.291,149.831,275.81
Capital Expenditure -184.39-225.41-251.37-213.90-298.30-318.26-353.13-391.82-434.75-482.38
Free Cash Flow 395.59251.70403.66804.70-4.60523.47580.83644.47715.08793.43
WACC
PV LFCF 480.74489.86499.16508.63518.28
SUM PV LFCF 2,496.67

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.89
Free cash flow (t + 1) 809.30
Terminal Value 11,745.99
Present Value of Terminal Value 7,672.72

Intrinsic Value

Enterprise Value 10,169.40
Net Debt 1,459.30
Equity Value 8,710.10
Shares Outstanding 62.70
Equity Value Per Share 138.92