Discounted Cash Flow (DCF) Analysis Unlevered

AAR Corp. (AIR)

$46.92

-0.64 (-1.35%)
All numbers are in Millions, Currency in USD
Stock DCF: 7.76 | 46.92 | overvalue

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 1,748.302,051.802,0721,652.301,8201,857.481,895.741,934.781,974.632,015.29
Revenue (%)
EBITDA 67.6064.706395.30140.8087.5489.3491.1893.0694.98
EBITDA (%)
EBIT 27.1021.9019.3059107.7048.4349.4350.4551.4952.55
EBIT (%)
Depreciation 40.5042.8043.7036.3033.1039.1139.9140.7441.5742.43
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 31.1021.30404.7051.8053.50105.59107.77109.99112.25114.56
Total Cash (%)
Account Receivables 202257221.20238.60287.60241.47246.44251.51256.69261.98
Account Receivables (%)
Inventories 460.70523.70623.10540.60550.50538.35549.43560.75572.30584.08
Inventories (%)
Accounts Payable 170187.80191.60127.20156.40165168.40171.87175.41179.02
Accounts Payable (%)
Capital Expenditure -22-17.40-23.60-11.30-17.30-18.13-18.50-18.88-19.27-19.67
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 46.92
Beta 1.576
Diluted Shares Outstanding 36
Cost of Debt
Tax Rate 25.12
After-tax Cost of Debt 1.15%
Risk-Free Rate
Market Risk Premium
Cost of Equity 11.038
Total Debt 156.30
Total Equity 1,689.12
Total Capital 1,845.42
Debt Weighting 8.47
Equity Weighting 91.53
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 1,748.302,051.802,0721,652.301,8201,857.481,895.741,934.781,974.632,015.29
EBITDA 67.6064.706395.30140.8087.5489.3491.1893.0694.98
EBIT 27.1021.9019.3059107.7048.4349.4350.4551.4952.55
Tax Rate 79.79%91.57%85.53%44.50%25.12%65.30%65.30%65.30%65.30%65.30%
EBIAT 5.481.852.7932.7580.6516.8117.1517.5017.8718.23
Depreciation 40.5042.8043.7036.3033.1039.1139.9140.7441.5742.43
Accounts Receivable --5535.80-17.40-4946.13-4.97-5.08-5.18-5.29
Inventories --63-99.4082.50-9.9012.15-11.09-11.32-11.55-11.79
Accounts Payable -17.803.80-64.4029.208.603.403.473.543.61
Capital Expenditure -22-17.40-23.60-11.30-17.30-18.13-18.50-18.88-19.27-19.67
UFCF 23.98-72.95-36.9158.4566.75104.6825.9026.4426.9827.54
WACC
PV UFCF 94.9921.3319.7518.2916.94
SUM PV UFCF 171.31

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 10.20
Free cash flow (t + 1) 28.09
Terminal Value 342.51
Present Value of Terminal Value 210.75

Intrinsic Value

Enterprise Value 382.05
Net Debt 102.80
Equity Value 279.25
Shares Outstanding 36
Equity Value Per Share 7.76