Discounted Cash Flow (DCF) Analysis Levered

Texas Capital Bancshares, Inc. (TCBI)

$59.28

-0.50 (-0.84%)

All numbers are in Millions, Currency in USD

Stock DCF: 172.43 | 59.28 | 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	977.95	1,049.59	989.72	879.30	976.76	980.54	984.34	988.15	991.97	995.81
Revenue (%)
Operating Cash Flow	-679.72	-240.27	2,639.87	657.31	147.97	518.19	520.20	522.21	524.23	526.26
Operating Cash Flow (%)
Capital Expenditure	-7.65	-16.65	-2.80	-4.13	-11.27	-8.38	-8.42	-8.45	-8.48	-8.51
Capital Expenditure (%)
Free Cash Flow	-687.37	-256.92	2,637.07	653.19	136.70	509.81	511.78	513.76	515.75	517.75

Weighted Average Cost Of Capital

Share price	$ 59.28
Beta	1.326
Diluted Shares Outstanding	50.58
Cost of Debt
Tax Rate	22.99
After-tax Cost of Debt	9.70%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.695
Total Debt	2,132.58
Total Equity	2,998.56
Total Capital	5,131.14
Debt Weighting	41.56
Equity Weighting	58.44
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	977.95	1,049.59	989.72	879.30	976.76	980.54	984.34	988.15	991.97	995.81
Operating Cash Flow	-679.72	-240.27	2,639.87	657.31	147.97	518.19	520.20	522.21	524.23	526.26
Capital Expenditure	-7.65	-16.65	-2.80	-4.13	-11.27	-8.38	-8.42	-8.45	-8.48	-8.51
Free Cash Flow	-687.37	-256.92	2,637.07	653.19	136.70	509.81	511.78	513.76	515.75	517.75
WACC
PV LFCF						462.29	420.82	383.07	348.70	317.42
SUM PV LFCF										1,932.29

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	10.28
Free cash flow (t + 1)	528.10
Terminal Value	6,378.07
Present Value of Terminal Value	3,910.26

Intrinsic Value

Enterprise Value	5,842.55
Net Debt	-2,879.68
Equity Value	8,722.23
Shares Outstanding	50.58
Equity Value Per Share	172.43