Discounted Cash Flow (DCF) Analysis Unlevered

Brown & Brown, Inc. (BRO)

$59.59

+2.23 (+3.89%)
All numbers are in Millions, Currency in USD
Stock DCF: 89.98 | 59.59 | undervalue

Operating Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 1,857.272,009.862,384.742,606.113,047.523,451.993,910.144,429.105,016.935,682.78
Revenue (%)
EBITDA 596.18612.42718.30817.87986.941,080.191,223.561,385.951,569.891,778.25
EBITDA (%)
EBIT 488.04503.04589.59683.07834.04894.811,013.571,148.091,300.461,473.06
EBIT (%)
Depreciation 108.14109.38128.72134.80152.90185.39209.99237.86269.43305.19
Depreciation (%)

Balance Sheet Data

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Total Cash 598.35451.83554.50835.73899.90963.421,091.291,236.131,400.191,586.02
Total Cash (%)
Account Receivables 1,024.22910.211,001.341,142.721,279.291,575.831,784.972,021.882,290.222,594.18
Account Receivables (%)
Inventories ----------
Inventories (%)
Accounts Payable 749.34944.901,114.281,389.031,590.931,654.111,873.652,122.322,403.992,723.05
Accounts Payable (%)
Capital Expenditure -24.19-41.52-73.11-70.70-45.04-73.35-83.09-94.12-106.61-120.76
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price $ 59.59
Beta 0.744
Diluted Shares Outstanding 277.41
Cost of Debt
Tax Rate 23.04
After-tax Cost of Debt 2.44%
Risk-Free Rate
Market Risk Premium
Cost of Equity 7.110
Total Debt 2,246.35
Total Equity 16,531.10
Total Capital 18,777.45
Debt Weighting 11.96
Equity Weighting 88.04
Wacc

Build Up Free Cash

Year
A/P
2017
Actual
2018
Actual
2019
Actual
2020
Actual
2021
Actual
2022
Projected
2023
Projected
2024
Projected
2025
Projected
2026
Projected
Revenue 1,857.272,009.862,384.742,606.113,047.523,451.993,910.144,429.105,016.935,682.78
EBITDA 596.18612.42718.30817.87986.941,080.191,223.561,385.951,569.891,778.25
EBIT 488.04503.04589.59683.07834.04894.811,013.571,148.091,300.461,473.06
Tax Rate 11.14%25.56%24.23%23.01%23.04%21.39%21.39%21.39%21.39%21.39%
EBIAT 433.68374.46446.75525.89641.92703.37796.72902.461,022.241,157.91
Depreciation 108.14109.38128.72134.80152.90185.39209.99237.86269.43305.19
Accounts Receivable -114.01-91.13-141.38-136.58-296.54-209.14-236.90-268.34-303.96
Inventories ----------
Accounts Payable -195.56169.37274.75201.9163.18219.53248.67281.68319.06
Capital Expenditure -24.19-41.52-73.11-70.70-45.05-73.35-83.09-94.12-106.61-120.76
UFCF 517.63751.90580.60723.36815.10582.04934.011,057.971,198.391,357.44
WACC
PV UFCF 546.26822.71874.61929.79988.44
SUM PV UFCF 4,161.81

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%) 6.55
Free cash flow (t + 1) 1,384.59
Terminal Value 30,430.45
Present Value of Terminal Value 22,158.54

Intrinsic Value

Enterprise Value 26,320.35
Net Debt 1,359.35
Equity Value 24,961
Shares Outstanding 277.41
Equity Value Per Share 89.98