Discounted Cash Flow (DCF) Analysis Unlevered

Best Buy Co., Inc. (BBY)

$74.69

+3.40 (+4.77%)
All numbers are in Millions, Currency in USD
Stock DCF: 136.65 | 74.69 | 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 42,15142,87943,63847,26251,76154,520.0157,426.0960,487.0763,711.2167,107.21
Revenue (%)
EBITDA 2,5762,7312,8693,2683,9223,657.943,852.924,058.294,274.614,502.46
EBITDA (%)
EBIT 1,8931,9612,0572,4293,0532,705.922,850.153,002.073,162.093,330.64
EBIT (%)
Depreciation 683770812839869952.021,002.771,056.221,112.521,171.82
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 3,1331,9802,2295,4942,9363,756.993,957.254,168.184,390.364,624.38
Total Cash (%)
Account Receivables 1,0491,0151,1491,0611,0421,280.881,349.151,421.071,496.811,576.60
Account Receivables (%)
Inventories 5,2095,4095,1745,6125,9656,567.216,917.267,285.977,674.348,083.40
Inventories (%)
Accounts Payable 4,8735,2575,2886,9796,8036,962.047,333.147,724.028,135.738,569.39
Accounts Payable (%)
Capital Expenditure -688-819-743-713-737-891.66-939.19-989.25-1,041.98-1,097.52
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 74.69
Beta 1.435
Diluted Shares Outstanding 249.30
Cost of Debt
Tax Rate 18.85
After-tax Cost of Debt 0.52%
Risk-Free Rate
Market Risk Premium
Cost of Equity 9.899
Total Debt 3,888
Total Equity 18,620.22
Total Capital 22,508.22
Debt Weighting 17.27
Equity Weighting 82.73
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 42,15142,87943,63847,26251,76154,520.0157,426.0960,487.0763,711.2167,107.21
EBITDA 2,5762,7312,8693,2683,9223,657.943,852.924,058.294,274.614,502.46
EBIT 1,8931,9612,0572,4293,0532,705.922,850.153,002.073,162.093,330.64
Tax Rate 44.96%22.46%22.68%24.36%18.85%26.66%26.66%26.66%26.66%26.66%
EBIAT 1,041.831,520.611,590.491,837.332,477.531,984.472,090.252,201.672,319.022,442.63
Depreciation 683770812839869952.021,002.771,056.221,112.521,171.82
Accounts Receivable -34-1348819-238.88-68.27-71.91-75.75-79.78
Inventories --200235-438-353-602.21-350.05-368.71-388.36-409.06
Accounts Payable -384311,691-176159.04371.10390.88411.71433.66
Capital Expenditure -688-819-743-713-737-891.66-939.19-989.25-1,041.98-1,097.52
UFCF 1,036.831,689.611,791.493,304.332,099.531,362.792,106.602,218.892,337.162,461.74
WACC
PV UFCF 1,258.581,796.741,747.801,700.191,653.87
SUM PV UFCF 8,157.18

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 8.28
Free cash flow (t + 1) 2,510.98
Terminal Value 39,983.71
Present Value of Terminal Value 26,862.22

Intrinsic Value

Enterprise Value 35,019.39
Net Debt 952
Equity Value 34,067.39
Shares Outstanding 249.30
Equity Value Per Share 136.65