Discounted Cash Flow (DCF) Analysis Unlevered

Arezzo Indústria e Comércio S.A. (ARZZ3.SA)

$78.56

+0.97 (+1.25%)
All numbers are in Millions, Currency in USD
Stock DCF: 305.16 | 78.56 | 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 1,526.661,679.231,590.992,923.834,233.735,644.767,526.0710,034.4013,378.7117,837.62
Revenue (%)
EBITDA 219.33297.19159.15551.72703.44875.531,167.331,556.382,075.102,766.70
EBITDA (%)
EBIT 178.45216.8678.05445.97537.41648.64864.831,153.061,537.352,049.73
EBIT (%)
Depreciation 40.8880.3281.10105.75166.03226.89302.50403.33537.75716.97
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 235.80277.68561.16262.56476.43987.681,316.861,755.752,340.913,121.10
Total Cash (%)
Account Receivables ----------
Account Receivables (%)
Inventories 146.36173.87283.01436.52743.86792.851,057.101,409.411,879.152,505.44
Inventories (%)
Accounts Payable 110.12134.97399.19574.71671.66856.451,141.891,522.462,029.872,706.39
Accounts Payable (%)
Capital Expenditure -48.61-65.61-46.19-168.88-233.14-240.21-320.27-427-569.32-759.06
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 78.56
Beta 0.724
Diluted Shares Outstanding 91.64
Cost of Debt
Tax Rate 10.19
After-tax Cost of Debt 7.21%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.203
Total Debt 776.41
Total Equity 7,199.32
Total Capital 7,975.73
Debt Weighting 9.73
Equity Weighting 90.27
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 1,526.661,679.231,590.992,923.834,233.735,644.767,526.0710,034.4013,378.7117,837.62
EBITDA 219.33297.19159.15551.72703.44875.531,167.331,556.382,075.102,766.70
EBIT 178.45216.8678.05445.97537.41648.64864.831,153.061,537.352,049.73
Tax Rate 16.09%20.88%10.95%14.52%10.19%14.52%14.52%14.52%14.52%14.52%
EBIAT 149.73171.5869.50381.24482.68554.43739.22985.591,314.071,752.03
Depreciation 40.8880.3281.10105.75166.03226.89302.50403.33537.75716.97
Accounts Receivable ----------
Inventories --27.51-109.14-153.51-307.34-48.99-264.25-352.31-469.74-626.29
Accounts Payable -24.85264.22175.5296.95184.78285.44380.57507.41676.52
Capital Expenditure -48.61-65.61-46.19-168.88-233.14-240.21-320.27-427-569.32-759.06
UFCF 142183.64259.50340.12205.17676.91742.65990.171,320.171,760.17
WACC
PV UFCF 631.44646.24803.76999.661,243.31
SUM PV UFCF 4,324.41

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 7.20
Free cash flow (t + 1) 1,795.37
Terminal Value 34,526.36
Present Value of Terminal Value 24,388.04

Intrinsic Value

Enterprise Value 28,712.45
Net Debt 747.58
Equity Value 27,964.87
Shares Outstanding 91.64
Equity Value Per Share 305.16