Discounted Cash Flow (DCF) Analysis Levered

Spotify Technology S.A. (SPOT)

$153.03

-3.31 (-2.12%)

All numbers are in Millions, Currency in USD

Stock DCF: 49.01 | 153.03 | overvalue

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	5,259	6,764	7,880	9,668	11,727	14,339.31	17,533.54	21,439.32	26,215.15	32,054.84
Revenue (%)
Operating Cash Flow	344	573	259	361	46	643.13	786.40	961.58	1,175.78	1,437.69
Operating Cash Flow (%)
Capital Expenditure	-125	-135	-78	-85	-25	-185.12	-226.36	-276.78	-338.44	-413.83
Capital Expenditure (%)
Free Cash Flow	219	438	181	276	21	458.01	560.04	684.80	837.34	1,023.87

Weighted Average Cost Of Capital

Share price	$ 153.03
Beta	1.765
Diluted Shares Outstanding	195.85
Cost of Debt
Tax Rate	-16.22
After-tax Cost of Debt	3.45%
Risk-Free Rate
Market Risk Premium
Cost of Equity	12.028
Total Debt	1,683
Total Equity	29,970.37
Total Capital	31,653.37
Debt Weighting	5.32
Equity Weighting	94.68
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	5,259	6,764	7,880	9,668	11,727	14,339.31	17,533.54	21,439.32	26,215.15	32,054.84
Operating Cash Flow	344	573	259	361	46	643.13	786.40	961.58	1,175.78	1,437.69
Capital Expenditure	-125	-135	-78	-85	-25	-185.12	-226.36	-276.78	-338.44	-413.83
Free Cash Flow	219	438	181	276	21	458.01	560.04	684.80	837.34	1,023.87
WACC
PV LFCF						237.46	260.25	285.22	312.59	342.59
SUM PV LFCF										2,486.16

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	11.57
Free cash flow (t + 1)	1,044.34
Terminal Value	10,912.69
Present Value of Terminal Value	6,312.40

Intrinsic Value

Enterprise Value	8,798.56
Net Debt	-800
Equity Value	9,598.56
Shares Outstanding	195.85
Equity Value Per Share	49.01