Discounted Cash Flow (DCF) Analysis Levered

Vertex Pharmaceuticals Incorporated (VRTX)

$268.35

+9.76 (+3.77%)
All numbers are in Millions, Currency in USD
Stock DCF: 1,082.21 | 268.35 | 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 2,488.653,047.604,162.826,205.687,574.4010,039.5513,30717,637.8723,378.2530,986.88
Revenue (%)
Operating Cash Flow 844.941,270.291,569.333,253.502,643.504,029.085,340.377,078.449,382.1712,435.68
Operating Cash Flow (%)
Capital Expenditure -259.42-95.52-75.45-259.80-235-454.99-603.07-799.35-1,059.51-1,404.33
Capital Expenditure (%)
Free Cash Flow 585.521,174.761,493.882,993.712,408.503,574.084,737.306,279.098,322.6711,031.35

Weighted Average Cost Of Capital

Share price $ 268.35
Beta 0.546
Diluted Shares Outstanding 263.40
Cost of Debt
Tax Rate 14.22
After-tax Cost of Debt 5.64%
Risk-Free Rate
Market Risk Premium
Cost of Equity 5.438
Total Debt 934.10
Total Equity 70,682.32
Total Capital 71,616.42
Debt Weighting 1.30
Equity Weighting 98.70
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 2,488.653,047.604,162.826,205.687,574.4010,039.5513,30717,637.8723,378.2530,986.88
Operating Cash Flow 844.941,270.291,569.333,253.502,643.504,029.085,340.377,078.449,382.1712,435.68
Capital Expenditure -259.42-95.52-75.45-259.80-235-454.99-603.07-799.35-1,059.51-1,404.33
Free Cash Flow 585.521,174.761,493.882,993.712,408.503,574.084,737.306,279.098,322.6711,031.35
WACC
PV LFCF 3,389.694,261.085,356.496,733.508,464.51
SUM PV LFCF 28,205.27

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.44
Free cash flow (t + 1) 11,251.97
Terminal Value 327,092.29
Present Value of Terminal Value 250,982.43

Intrinsic Value

Enterprise Value 279,187.70
Net Debt -5,860.90
Equity Value 285,048.60
Shares Outstanding 263.40
Equity Value Per Share 1,082.21