Discounted Cash Flow (DCF) Analysis Levered

The Charles Schwab Corporation (SCHW)

$54.9

+0.35 (+0.64%)
All numbers are in Millions, Currency in USD
Stock DCF: 244.56 | 54.9 | undervalue

Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 10,13210,72111,69118,52020,76225,193.6130,571.1337,096.4845,014.6554,622.94
Revenue (%)
Operating Cash Flow 12,4569,3256,8522,1182,05714,605.6917,723.2521,506.2426,096.7131,667
Operating Cash Flow (%)
Capital Expenditure -570-708-631-916-971-1,373.04-1,666.11-2,021.74-2,453.27-2,976.92
Capital Expenditure (%)
Free Cash Flow 11,8868,6176,2211,2021,08613,232.6616,057.1419,484.5123,643.4328,690.08

Weighted Average Cost Of Capital

Share price $ 54.9
Beta 0.925
Diluted Shares Outstanding 1,894
Cost of Debt
Tax Rate 23.49
After-tax Cost of Debt 3.12%
Risk-Free Rate
Market Risk Premium
Cost of Equity 8.937
Total Debt 37,878
Total Equity 103,980.60
Total Capital 141,858.60
Debt Weighting 26.70
Equity Weighting 73.30
Wacc

Build Up Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 10,13210,72111,69118,52020,76225,193.6130,571.1337,096.4845,014.6554,622.94
Operating Cash Flow 12,4569,3256,8522,1182,05714,605.6917,723.2521,506.2426,096.7131,667
Capital Expenditure -570-708-631-916-971-1,373.04-1,666.11-2,021.74-2,453.27-2,976.92
Free Cash Flow 11,8868,6176,2211,2021,08613,232.6616,057.1419,484.5123,643.4328,690.08
WACC
PV LFCF 12,323.2013,925.8415,736.9017,783.4920,096.24
SUM PV LFCF 79,865.67

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.38
Free cash flow (t + 1) 29,263.88
Terminal Value 543,938.31
Present Value of Terminal Value 381,006.73

Intrinsic Value

Enterprise Value 460,872.40
Net Debt -2,317
Equity Value 463,189.40
Shares Outstanding 1,894
Equity Value Per Share 244.56