Discounted Cash Flow (DCF) Analysis Levered

Zimmer Biomet Holdings, Inc. (ZBH)

$126.04

+1.08 (+0.86%)

All numbers are in Millions, Currency in USD

Stock DCF: 55.72 | 126.04 | overvalue

Free Cash Flow

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	7,982.20	7,024.50	7,836.20	6,939.90	6,665.07	6,401.12	6,147.62	5,904.16	5,670.34
Revenue (%)
Operating Cash Flow	1,585.80	1,204.50	1,499.20	1,356.20	1,261.16	1,211.21	1,163.25	1,117.18	1,072.94
Operating Cash Flow (%)
Capital Expenditure	-404.70	-117.90	-180.40	-187.90	-195.92	-188.16	-180.71	-173.55	-166.68
Capital Expenditure (%)
Free Cash Flow	1,181.10	1,086.60	1,318.80	1,168.30	1,065.24	1,023.05	982.54	943.63	906.26

Weighted Average Cost Of Capital

Share price	$ 126.04
Beta	1.005
Diluted Shares Outstanding	210.30
Cost of Debt
Tax Rate	27.83
After-tax Cost of Debt	2.09%
Risk-Free Rate
Market Risk Premium
Cost of Equity	8.123
Total Debt	5,696.50
Total Equity	26,506.21
Total Capital	32,202.71
Debt Weighting	17.69
Equity Weighting	82.31
Wacc

Build Up Free Cash Flow

Year A/P	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	7,982.20	7,024.50	7,836.20	6,939.90	6,665.07	6,401.12	6,147.62	5,904.16	5,670.34
Operating Cash Flow	1,585.80	1,204.50	1,499.20	1,356.20	1,261.16	1,211.21	1,163.25	1,117.18	1,072.94
Capital Expenditure	-404.70	-117.90	-180.40	-187.90	-195.92	-188.16	-180.71	-173.55	-166.68
Free Cash Flow	1,181.10	1,086.60	1,318.80	1,168.30	1,065.24	1,023.05	982.54	943.63	906.26
WACC
PV LFCF					757.37	679.41	609.48	546.74	490.46
SUM PV LFCF									4,050.87

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.06
Free cash flow (t + 1)	924.38
Terminal Value	18,268.39
Present Value of Terminal Value	12,988.65

Intrinsic Value

Enterprise Value	17,039.52
Net Debt	5,320.80
Equity Value	11,718.72
Shares Outstanding	210.30
Equity Value Per Share	55.72