Discounted Cash Flow (DCF) Analysis Unlevered

American Eagle Outfitters, Inc. (AEO)

$11.43

+0.25 (+2.24%)
All numbers are in Millions, Currency in USD
Stock DCF: 28.32 | 11.43 | undervalue

Operating Data

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 3,795.554,035.724,308.213,759.115,010.795,432.085,888.806,383.926,920.677,502.55
Revenue (%)
EBITDA 456.65515.60426.66-126.69764.71506.28548.85595645.03699.26
EBITDA (%)
EBIT 287.17345.10245.28-292.27593.55281.17304.82330.44358.23388.35
EBIT (%)
Depreciation 169.47170.50181.38165.58171.15225.11244.04264.56286.80310.91
Depreciation (%)

Balance Sheet Data

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Total Cash 413.61425.47416.93850.48434.77678.12735.14796.95863.96936.60
Total Cash (%)
Account Receivables 78.3093.48119.06146.10286.68181.98197.29213.87231.85251.35
Account Receivables (%)
Inventories 398.21424.40446.28405.44553.46577.95626.54679.22736.33798.23
Inventories (%)
Accounts Payable 236.70240.67285.75255.91231.78328.81356.46386.43418.92454.14
Accounts Payable (%)
Capital Expenditure -172.15-189.69-210.36-127.98-233.85-241.08-261.34-283.32-307.14-332.96
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 11.43
Beta 1.330
Diluted Shares Outstanding 166.46
Cost of Debt
Tax Rate 24.92
After-tax Cost of Debt 1.44%
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.168
Total Debt 1,806.49
Total Equity 1,902.58
Total Capital 3,709.07
Debt Weighting 48.70
Equity Weighting 51.30
Wacc

Build Up Free Cash

Year
A/P
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Actual
2023
Projected
2024
Projected
2025
Projected
2026
Projected
2027
Projected
Revenue 3,795.554,035.724,308.213,759.115,010.795,432.085,888.806,383.926,920.677,502.55
EBITDA 456.65515.60426.66-126.69764.71506.28548.85595645.03699.26
EBIT 287.17345.10245.28-292.27593.55281.17304.82330.44358.23388.35
Tax Rate 28.91%24.11%22.02%28.40%24.92%25.67%25.67%25.67%25.67%25.67%
EBIAT 204.16261.90191.26-209.27445.63208.99226.56245.61266.26288.65
Depreciation 169.47170.50181.38165.58171.15225.11244.04264.56286.80310.91
Accounts Receivable --15.17-25.59-27.04-140.58104.70-15.30-16.59-17.98-19.49
Inventories --26.19-21.8740.83-148.01-24.49-48.59-52.68-57.11-61.91
Accounts Payable -3.9745.07-29.83-24.1397.0327.6529.9732.4935.22
Capital Expenditure -172.15-189.69-210.36-127.97-233.85-241.08-261.34-283.32-307.14-332.96
UFCF 201.49205.32159.89-187.7170.21370.27173.01187.56203.32220.42
WACC
PV UFCF 351.30155.74160.18164.75169.45
SUM PV UFCF 1,001.42

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 5.40
Free cash flow (t + 1) 224.83
Terminal Value 6,612.59
Present Value of Terminal Value 5,083.57

Intrinsic Value

Enterprise Value 6,084.98
Net Debt 1,371.72
Equity Value 4,713.26
Shares Outstanding 166.46
Equity Value Per Share 28.32