Discounted Cash Flow (DCF) Analysis Levered

Sleep Country Canada Holdings Inc. (ZZZ.TO)

$26.03

-0.14 (-0.54%)

All numbers are in Millions, Currency in USD

Stock DCF: 69.42 | 26.03 | 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	622.98	712.37	757.70	920.19	928.66	1,028.67	1,139.45	1,262.16	1,398.09	1,548.66
Revenue (%)
Operating Cash Flow	68.10	132.06	173.70	156.14	163.06	178.83	198.09	219.42	243.05	269.22
Operating Cash Flow (%)
Capital Expenditure	-27.17	-35.45	-17.66	-24.12	-17.22	-33.22	-36.79	-40.75	-45.14	-50.01
Capital Expenditure (%)
Free Cash Flow	40.93	96.61	156.04	132.02	145.84	145.61	161.29	178.66	197.90	219.22

Weighted Average Cost Of Capital

Share price	$ 26.03
Beta	1.551
Diluted Shares Outstanding	37.21
Cost of Debt
Tax Rate	24.36
After-tax Cost of Debt	2.83%
Risk-Free Rate
Market Risk Premium
Cost of Equity	11.132
Total Debt	412.86
Total Equity	968.52
Total Capital	1,381.39
Debt Weighting	29.89
Equity Weighting	70.11
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	622.98	712.37	757.70	920.19	928.66	1,028.67	1,139.45	1,262.16	1,398.09	1,548.66
Operating Cash Flow	68.10	132.06	173.70	156.14	163.06	178.83	198.09	219.42	243.05	269.22
Capital Expenditure	-27.17	-35.45	-17.66	-24.12	-17.22	-33.22	-36.79	-40.75	-45.14	-50.01
Free Cash Flow	40.93	96.61	156.04	132.02	145.84	145.61	161.29	178.66	197.90	219.22
WACC
PV LFCF						134.02	136.63	139.30	142.02	144.79
SUM PV LFCF										696.75

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	8.65
Free cash flow (t + 1)	223.60
Terminal Value	3,362.43
Present Value of Terminal Value	2,220.78

Intrinsic Value

Enterprise Value	2,917.53
Net Debt	334.55
Equity Value	2,582.98
Shares Outstanding	37.21
Equity Value Per Share	69.42