Discounted Cash Flow (DCF) Analysis Levered

Xerox Holdings Corporation (XRX)

$17.18

-0.06 (-0.35%)

All numbers are in Millions, Currency in USD

Stock DCF: 28.44 | 17.18 | 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	10,265	9,830	9,066	7,022	7,038	6,434	5,881.84	5,377.07	4,915.61	4,493.75
Revenue (%)
Operating Cash Flow	34	1,140	1,333	548	629	558.12	510.23	466.44	426.41	389.81
Operating Cash Flow (%)
Capital Expenditure	-105	-90	-65	-74	-68	-60.16	-55	-50.28	-45.97	-42.02
Capital Expenditure (%)
Free Cash Flow	-71	1,050	1,268	474	561	497.96	455.22	416.16	380.44	347.79

Weighted Average Cost Of Capital

Share price	$ 17.18
Beta	1.689
Diluted Shares Outstanding	208.98
Cost of Debt
Tax Rate	4.21
After-tax Cost of Debt	2.03%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.758
Total Debt	4,537
Total Equity	3,590.33
Total Capital	8,127.33
Debt Weighting	55.82
Equity Weighting	44.18
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	10,265	9,830	9,066	7,022	7,038	6,434	5,881.84	5,377.07	4,915.61	4,493.75
Operating Cash Flow	34	1,140	1,333	548	629	558.12	510.23	466.44	426.41	389.81
Capital Expenditure	-105	-90	-65	-74	-68	-60.16	-55	-50.28	-45.97	-42.02
Free Cash Flow	-71	1,050	1,268	474	561	497.96	455.22	416.16	380.44	347.79
WACC
PV LFCF						470.26	405.99	350.50	302.60	261.24
SUM PV LFCF										1,790.60

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	5.89
Free cash flow (t + 1)	354.75
Terminal Value	9,119.53
Present Value of Terminal Value	6,850.11

Intrinsic Value

Enterprise Value	8,640.71
Net Debt	2,697
Equity Value	5,943.71
Shares Outstanding	208.98
Equity Value Per Share	28.44