Discounted Cash Flow (DCF) Analysis Levered

Wavestone SA (WAVE.PA)

44.65 €

+0.65 (+1.48%)

All numbers are in Millions, Currency in USD

Stock DCF: 62.59 | 44.65 | 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	359.92	391.53	422.04	417.61	470.06	503.06	538.38	576.18	616.64	659.93
Revenue (%)
Operating Cash Flow	30.14	32.62	55.30	70.82	56.34	59.11	63.26	67.70	72.46	77.54
Operating Cash Flow (%)
Capital Expenditure	-2.71	-1.45	-3.06	-0.75	-0.46	-2.14	-2.29	-2.45	-2.62	-2.80
Capital Expenditure (%)
Free Cash Flow	27.43	31.17	52.24	70.07	55.88	56.97	60.97	65.26	69.84	74.74

Weighted Average Cost Of Capital

Share price	$ 44.65
Beta	0.945
Diluted Shares Outstanding	19.94
Cost of Debt
Tax Rate	29.04
After-tax Cost of Debt	0.97%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.096
Total Debt	65.97
Total Equity	890.27
Total Capital	956.24
Debt Weighting	6.90
Equity Weighting	93.10
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	359.92	391.53	422.04	417.61	470.06	503.06	538.38	576.18	616.64	659.93
Operating Cash Flow	30.14	32.62	55.30	70.82	56.34	59.11	63.26	67.70	72.46	77.54
Capital Expenditure	-2.71	-1.45	-3.06	-0.75	-0.46	-2.14	-2.29	-2.45	-2.62	-2.80
Free Cash Flow	27.43	31.17	52.24	70.07	55.88	56.97	60.97	65.26	69.84	74.74
WACC
PV LFCF						52.95	52.67	52.38	52.10	51.82
SUM PV LFCF										261.92

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.60
Free cash flow (t + 1)	76.24
Terminal Value	1,361.35
Present Value of Terminal Value	943.86

Intrinsic Value

Enterprise Value	1,205.78
Net Debt	-42.28
Equity Value	1,248.06
Shares Outstanding	19.94
Equity Value Per Share	62.59