Discounted Cash Flow (DCF) Analysis Levered

Verizon Communications Inc. (VZ)

$41.05

+0.41 (+1.01%)
All numbers are in Millions, Currency in USD
Stock DCF: 24.40 | 41.05 | overvalue

Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 130,863131,868128,292133,613134,594.50135,583.20136,579.17137,582.46138,593.12139,611.20
Revenue (%)
Operating Cash Flow 34,33935,74641,76839,53938,863.1539,148.6339,436.2139,725.9040,017.7240,311.68
Operating Cash Flow (%)
Capital Expenditure -18,087-18,837-20,318-67,882-31,881.50-32,115.70-32,351.61-32,589.26-32,828.66-33,069.81
Capital Expenditure (%)
Free Cash Flow 16,25216,90921,450-28,3436,981.657,032.937,084.597,136.647,189.067,241.87

Weighted Average Cost Of Capital

Share price $ 41.05
Beta 0.339
Diluted Shares Outstanding 4,150
Cost of Debt
Tax Rate 25.00
After-tax Cost of Debt 3.75%
Risk-Free Rate
Market Risk Premium
Cost of Equity 5.151
Total Debt 176,331
Total Equity 170,357.50
Total Capital 346,688.50
Debt Weighting 50.86
Equity Weighting 49.14
Wacc

Build Up Free Cash Flow

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 130,863131,868128,292133,613134,594.50135,583.20136,579.17137,582.46138,593.12139,611.20
Operating Cash Flow 34,33935,74641,76839,53938,863.1539,148.6339,436.2139,725.9040,017.7240,311.68
Capital Expenditure -18,087-18,837-20,318-67,882-31,881.50-32,115.70-32,351.61-32,589.26-32,828.66-33,069.81
Free Cash Flow 16,25216,90921,450-28,3436,981.657,032.937,084.597,136.647,189.067,241.87
WACC
PV LFCF 6,981.656,733.946,495.036,264.596,042.335,827.96
SUM PV LFCF 31,363.86

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 4.44
Free cash flow (t + 1) 7,386.71
Terminal Value 302,733.91
Present Value of Terminal Value 243,627.75

Intrinsic Value

Enterprise Value 274,991.61
Net Debt 173,726
Equity Value 101,265.61
Shares Outstanding 4,150
Equity Value Per Share 24.40