Discounted Cash Flow (DCF) Analysis Unlevered

Advance Auto Parts, Inc. (AAP)

$161.88

-3.26 (-1.97%)
All numbers are in Millions, Currency in USD
Stock DCF: 87.65 | 161.88 | overvalue

Operating Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Projected
2021
Projected
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 9,373.789,580.559,7099,881.1710,056.3910,234.7210,416.2110,600.9210,788.9010,980.2211,174.93
Revenue (%)
EBITDA 972.12855.69916.02946.51963.30980.38997.761,015.461,033.461,051.791,070.44
EBITDA (%)
EBIT 722.86617.51677.64696.18708.52721.09733.87746.89760.13773.61787.33
EBIT (%)
Depreciation 249.26238.18238.37250.34254.78259.29263.89268.57273.33278.18283.11
Depreciation (%)

Balance Sheet Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Projected
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Total Cash 546.94896.53418.67642.43653.82665.42677.22689.22701.45713.88726.54
Total Cash (%)
Account Receivables 606.36624.97689.47661.82673.55685.50697.65710.03722.62735.43748.47
Account Receivables (%)
Inventories 4,168.494,362.554,432.174,468.114,547.344,627.984,710.044,793.574,878.574,965.085,053.12
Inventories (%)
Accounts Payable 2,894.583,172.793,421.993,268.763,326.723,385.713,445.753,506.863,569.043,632.333,696.74
Accounts Payable (%)
Capital Expenditure -189.76-193.71-471.65-293.28-298.48-303.77-309.16-314.64-320.22-325.90-331.68
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 161.88
Beta 1.238
Diluted Shares Outstanding 69
Cost of Debt
Tax Rate 23.55
After-tax Cost of Debt 0.86%
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.697
Total Debt 3,371.97
Total Equity 11,170.21
Total Capital 14,542.18
Debt Weighting 23.19
Equity Weighting 76.81
Wacc

Build Up Free Cash

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Projected
2021
Projected
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 9,373.789,580.559,7099,881.1710,056.3910,234.7210,416.2110,600.9210,788.9010,980.2211,174.93
EBITDA 972.12855.69916.02946.51963.30980.38997.761,015.461,033.461,051.791,070.44
EBIT 722.86617.51677.64696.18708.52721.09733.87746.89760.13773.61787.33
Tax Rate 8.60%23.67%23.65%20.75%24.27%23.55%20.75%20.75%20.75%20.75%20.75%
EBIAT 660.68471.36517.36551.73536.57551.25581.60591.92602.41613.09623.97
Depreciation 249.26238.18238.37250.34254.78259.29263.89268.57273.33278.18283.11
Accounts Receivable --18.62-64.5027.65-11.74-11.94-12.16-12.37-12.59-12.81-13.04
Inventories --194.06-69.62-35.94-79.23-80.64-82.07-83.52-85-86.51-88.04
Accounts Payable -278.21249.20-153.2357.9658.9960.0461.1062.1963.2964.41
Capital Expenditure -189.76-193.72-471.65-293.28-267.81-289.64-309.16-314.64-320.22-325.90-331.68
UFCF 720.18581.37399.16347.27459.86473.18502.15511.05520.12529.34538.73
WACC
PV UFCF 373.83459.86439.56433.32409.66387.30366.15346.17
SUM PV UFCF 2,091.20

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.65
Free cash flow (t + 1) 549.50
Terminal Value 9,725.68
Present Value of Terminal Value 6,727.44

Intrinsic Value

Enterprise Value 8,818.65
Net Debt 2,770.54
Equity Value 6,048.10
Shares Outstanding 69
Equity Value Per Share 87.65