Discounted Cash Flow (DCF) Analysis Unlevered

BHP Group Limited (BHP)

$58.2

-0.56 (-0.95%)

All numbers are in Millions, Currency in USD

Stock DCF: 169.59 | 58.2 | 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	43,638	44,288	42,931	60,817	65,098	72,767.66	81,340.93	90,924.29	101,636.72	113,611.27
Revenue (%)
EBITDA	18,443	21,229	19,723	29,749	47,817	37,622.08	42,054.60	47,009.35	52,547.86	58,738.90
EBITDA (%)
EBIT	12,155	15,400	13,611	22,925	42,134	28,634.06	32,007.65	35,778.69	39,994.04	44,706.02
EBIT (%)
Depreciation	6,288	5,829	6,112	6,824	5,683	8,988.01	10,046.96	11,230.66	12,553.82	14,032.88
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	15,889	15,628	13,462	15,249	17,539	22,568.38	25,227.32	28,199.53	31,521.91	35,235.73
Total Cash (%)
Account Receivables	3,202	3,586	3,730	6,338	5,689	6,299.29	7,041.45	7,871.05	8,798.40	9,835
Account Receivables (%)
Inventories	3,764	3,840	4,101	4,426	4,935	6,069.84	6,784.98	7,584.36	8,477.93	9,476.77
Inventories (%)
Accounts Payable	5,977	6,717	5,767	5,079	5,360	8,569.36	9,578.97	10,707.54	11,969.07	13,379.23
Accounts Payable (%)
Capital Expenditure	-4,979	-6,250	-6,900	-6,606	-5,855	-8,943.22	-9,996.88	-11,174.68	-12,491.25	-13,962.94
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 58.2
Beta	0.833
Diluted Shares Outstanding	2,535.50
Cost of Debt
Tax Rate	6.75
After-tax Cost of Debt	2.83%
Risk-Free Rate
Market Risk Premium
Cost of Equity	7.537
Total Debt	16,428
Total Equity	147,566.10
Total Capital	163,994.10
Debt Weighting	10.02
Equity Weighting	89.98
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	43,638	44,288	42,931	60,817	65,098	72,767.66	81,340.93	90,924.29	101,636.72	113,611.27
EBITDA	18,443	21,229	19,723	29,749	47,817	37,622.08	42,054.60	47,009.35	52,547.86	58,738.90
EBIT	12,155	15,400	13,611	22,925	42,134	28,634.06	32,007.65	35,778.69	39,994.04	44,706.02
Tax Rate	74.88%	44.81%	41.11%	54.05%	6.75%	44.32%	44.32%	44.32%	44.32%	44.32%
EBIAT	3,052.96	8,499.73	8,015.48	10,533.89	39,289.63	15,943.35	17,821.75	19,921.45	22,268.54	24,892.16
Depreciation	6,288	5,829	6,112	6,824	5,683	8,988.01	10,046.96	11,230.66	12,553.82	14,032.88
Accounts Receivable	-	-384	-144	-2,608	649	-610.29	-742.16	-829.60	-927.34	-1,036.60
Inventories	-	-76	-261	-325	-509	-1,134.84	-715.13	-799.39	-893.57	-998.85
Accounts Payable	-	740	-950	-688	281	3,209.36	1,009.62	1,128.57	1,261.53	1,410.16
Capital Expenditure	-4,979	-6,250	-6,900	-6,606	-5,855	-8,943.22	-9,996.88	-11,174.68	-12,491.25	-13,962.94
UFCF	4,361.96	8,358.73	5,872.48	7,130.89	39,538.63	17,452.37	17,424.14	19,477.01	21,771.73	24,336.81
WACC
PV UFCF						16,299.96	15,199.03	15,867.88	16,566.16	17,295.16
SUM PV UFCF										81,228.19

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	7.07
Free cash flow (t + 1)	24,823.55
Terminal Value	489,616.37
Present Value of Terminal Value	347,950.06

Intrinsic Value

Enterprise Value	429,178.25
Net Debt	-808
Equity Value	429,986.25
Shares Outstanding	2,535.50
Equity Value Per Share	169.59