Discounted Cash Flow (DCF) Analysis Levered

Regions Financial Corporation (RF)

$21.88

+0.27 (+1.25%)

All numbers are in Millions, Currency in USD

Stock DCF: 72.67 | 21.88 | 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	5,670	5,821	5,825	6,225	6,376	6,567.67	6,765.10	6,968.47	7,177.95	7,393.73
Revenue (%)
Operating Cash Flow	2,281	2,275	2,581	2,324	3,030	2,738.41	2,820.73	2,905.52	2,992.86	3,082.83
Operating Cash Flow (%)
Capital Expenditure	-191	-71	-24	-59	-94.81	-97.66	-100.60	-103.62	-106.74	-109.95
Capital Expenditure (%)
Free Cash Flow	2,090	2,204	2,557	2,265	2,935.19	2,640.74	2,720.13	2,801.90	2,886.13	2,972.89

Weighted Average Cost Of Capital

Share price	$ 21.88
Beta	1.274
Diluted Shares Outstanding	958
Cost of Debt
Tax Rate	21.59
After-tax Cost of Debt	5.44%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.755
Total Debt	2,407
Total Equity	20,961.04
Total Capital	23,368.04
Debt Weighting	10.30
Equity Weighting	89.70
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	5,670	5,821	5,825	6,225	6,376	6,567.67	6,765.10	6,968.47	7,177.95	7,393.73
Operating Cash Flow	2,281	2,275	2,581	2,324	3,030	2,738.41	2,820.73	2,905.52	2,992.86	3,082.83
Capital Expenditure	-191	-71	-24	-59	-94.81	-97.66	-100.60	-103.62	-106.74	-109.95
Free Cash Flow	2,090	2,204	2,557	2,265	2,935.19	2,640.74	2,720.13	2,801.90	2,886.13	2,972.89
WACC
PV LFCF						2,435.88	2,314.46	2,199.10	2,089.48	1,985.33
SUM PV LFCF										11,024.25

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	8.41
Free cash flow (t + 1)	3,032.34
Terminal Value	47,306.46
Present Value of Terminal Value	31,591.76

Intrinsic Value

Enterprise Value	42,616
Net Debt	-27,004
Equity Value	69,620
Shares Outstanding	958
Equity Value Per Share	72.67