Discounted Cash Flow (DCF) Analysis Levered

Yum! Brands, Inc. (YUM)

$109.46

-3.01 (-2.68%)

All numbers are in Millions, Currency in USD

Stock DCF: 46.04 | 109.46 | overvalue

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	5,878	5,688	5,597	5,652	6,584	6,792.06	7,006.69	7,228.10	7,456.51	7,692.14
Revenue (%)
Operating Cash Flow	1,030	1,176	1,315	1,305	1,706	1,503.67	1,551.19	1,600.20	1,650.77	1,702.94
Operating Cash Flow (%)
Capital Expenditure	-318	-234	-196	-160	-230	-262.85	-271.16	-279.73	-288.57	-297.69
Capital Expenditure (%)
Free Cash Flow	712	942	1,119	1,145	1,476	1,240.82	1,280.03	1,320.48	1,362.21	1,405.25

Weighted Average Cost Of Capital

Share price	$ 109.46
Beta	1.097
Diluted Shares Outstanding	307
Cost of Debt
Tax Rate	5.91
After-tax Cost of Debt	4.52%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.062
Total Debt	11,334
Total Equity	33,604.22
Total Capital	44,938.22
Debt Weighting	25.22
Equity Weighting	74.78
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	5,878	5,688	5,597	5,652	6,584	6,792.06	7,006.69	7,228.10	7,456.51	7,692.14
Operating Cash Flow	1,030	1,176	1,315	1,305	1,706	1,503.67	1,551.19	1,600.20	1,650.77	1,702.94
Capital Expenditure	-318	-234	-196	-160	-230	-262.85	-271.16	-279.73	-288.57	-297.69
Free Cash Flow	712	942	1,119	1,145	1,476	1,240.82	1,280.03	1,320.48	1,362.21	1,405.25
WACC
PV LFCF						1,157.80	1,114.48	1,072.78	1,032.64	994
SUM PV LFCF										5,371.71

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.17
Free cash flow (t + 1)	1,433.36
Terminal Value	27,724.49
Present Value of Terminal Value	19,610.90

Intrinsic Value

Enterprise Value	24,982.61
Net Debt	10,848
Equity Value	14,134.61
Shares Outstanding	307
Equity Value Per Share	46.04